CRD IV and Basel III - outcome of political negotiations:

Type: News   Reference: 91680   Duration: 00:04:15  Lieu: Brussels, Belgium - European Parliament
End production: 28/02/2013   First transmission: 28/02/2013
- extracts from the press conference by Othmar KARAS (EPP, AT), rapporteur Background: Othmar Karas MEP has reached a political agreement on the new European banking regulation CRD4 (Basel III) tonight in the negotiations between the two EU legislators, the European Parliament and the Council of the European Union. The new law stabilises the banking sector by setting new capital requirements for European banks. Othmar Karas MEP, Parliament's negotiator for this new set of rules, explained: "For the first time in the history of EU financial market regulation, we will cap bankers' bonuses. But this is not the most important part of the new rules. The essence is that from 2014, European banks will have to set aside more money to be more stable and concentrate on their core business, namely financing the real economy, that of small and medium-sized enterprises and jobs." Bankers' bonuses will not be allowed to be higher than their fixed salary. Under certain circumstances, the shareholders of the bank can decide to allow bonuses up to twice the fixed salary. Part of the deal is also several measures to make loans to small and medium-sized enterprises easier. "The new banking law is not only a piece of banking regulation, but a real economy financing act", Karas concluded.

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00:00:00 Title 00:00:05
00:00:05 Exterior shot of the European Parliament, Brussels, Belgium (1 shot) 00:00:05
00:00:10 SOUNDBITE (German):Othmar KARAS (EPP, AT), rapporteur: We have done it, just after midnight this morning after 10 months of negotiation, with 3 different Council Presidencies, almost 30 'Trialogue meetings'; we have achieved the most comprehensive Bank regulation package in the European Union. 00:00:30
00:00:40 SOUNDBITE (German):Othmar KARAS (EPP, AT), rapporteur: For the first time there will be a capping of bank bonuses in the EU at 1 to 1. 00:00:15
00:00:55 SOUNDBITE (German):Othmar KARAS (EPP, AT), rapporteur: The most important thing is that European banks will be stabilized, that they are able to resist crisis better and that means that we have provided a comprehensive answer of what we learned from the financial crisis. 00:00:22
00:01:17 SOUNDBITE (German):Othmar KARAS (EPP, AT), rapporteur: At the moment banks have to set aside 2 percent of core capital, now 4 percent and in total it will be 8 percent. 00:00:12
00:01:29 SOUNDBITE (German):Othmar KARAS (EPP, AT), rapporteur: The banks must for a period of 30 days meet all their commitments. The money must be more liquid and more mobile. 3rdly in terms of implementation we recognized the particular features of the European bank landscape, the decentralised sector and the particular features of the financing of our real economy, with 80 % of credit of the real economy. We created rules for all 8000 banks in Europe and therefore have strengthen the Single market. 00:00:50
00:02:19 SOUNDBITE (French): Michel BARNIER, European Commissioner responsible for the Internal Market and Services: It set out for the 1st time in banking history in the world liquidity rules, now if these rules have existed for 5 or 6 years already probably we wouldn't have had the Lehmann brother scandal. 00:00:19
00:02:38 SOUNDBITE (German) Udo BULLMANN, (S&D, DE), shadow-rapporteur: If we say in the future the bonuses are not 20 times, but payments are not higher than 1 to 1 of the basic annual salary, that is an evolution in a sector that didn't have any rules Ladies and Gentlemen and that is the historical achievement of last night and of those negotiations. 00:00:22
00:03:00 SOUNDBITE (German) Udo BULLMANN, (S&D, DE), shadow-rapporteur: We are going further by saying that the bonus system itself must change. It must reward sustainability. And those who work properly, who work well will be rewarded with long term products and long term rewards and not with short term incorrectly targeted cash. 00:00:26
00:03:26 SOUNDBITE (English): Sharon BOWLES, (ALDE, UK), shadow rapporteur and Chair of the ECON committee: We have a growth package that does not only cover SME's but a very important area of trade finance, lowing risk rates, here we are going to be leading the world, but they will follow where we have gone. In fact there are several aspects of amendments that have carried through in this, where the European Parliament has led the thinking in the world. An another aspect is in the reporting of value encumbered assets, this is still in the technical 'to-do-box', but we have proposed has just come out as recommendation of the European systemic risk board. 00:00:36
00:04:02 cut aways (3 shots) 00:00:13
00:04:15 END 00:00:00
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