Today’s post assesses the news that the European Securities and Markets Authority (ESMA) has had its decision to reject Polish rating agency FinancialCraft’s application to be registered under EU regulation upheld, after an appeal was lodged to the Joint Board of Appeal of the European Supervisory Authorities. In this post we will look at some of the reasons for the rejection and assess whether the grounds for rejection were fair, especially in relation to recent instances of the larger rating agencies flouting the European regulations. FinancialCraft , a small Polish rating firm, had applied in 2016 to be registered as a recognised Credit Rating Agency under the EU Regulations on Credit Rating Agencies; on the 8 th of December 2016 that application was rejected by ESMA , the supervisory body tasked with supervising the CRA sector. In accordance with the regulations, which allow for a second application, FinancialCraft swiftly reapplied, with the same rejection following. As a ...

Here in  Financial Regulation Matters we have looked at the potential landscape for British finance post-Brexit on a number of occasions. Firstly, we looked at the battle for the marquee names in the wake of the U.K.’s secession from the Union between France and Germany. Then, in a later post, we discussed the strength of one of the frontrunners in the battle for post-Brexit business – Dublin. So, in today’s post, we will look at how this issue is developing – as it will no doubt continue to – and how the City of London is being put under increased pressure. Yet, in keeping with the underlying sentiment of Financial Regulation Matters , we will conclude by looking at what effect these pressures may have upon the wider society, particularly in Britain but in Europe also. Earlier this week, it was announced that Barclays are in talks with Irish regulators about substantially increasing its presence in the Country after Brexit, with the company noting that Ireland represents...

At the beginning of the month, we discussed here in Financial Regulation Matters the state-backed rescue of the world’s oldest bank – Monte dei Paschi di Siena (BMPS) – and what it may have meant for the issue of ‘too-big-to-fail’. Over the past weekend, news emerged from Italy that confirmed that the deterioration of BMPS was, as had been predicted , only the start of the troubling financial environment that is enveloping Italy at the moment. With the Italian Government receiving the support from the European Commission to provide financial assistance to two Venetian banks – Banca Popolare di Vicenza and Veneto Banca – the Government duly ‘bailed-out’ the two banks to the tune of €5.2 billion, with additional guarantees of €12 billion being put in place. In this post we shall therefore assess these recent developments, but then it will be important to ask what this means for the role, better yet the belief in financial regulation as an ideal – if the financial elite are consciou...

This post reacts to the news yesterday that the E.U. is developing plans to house the massive €1.2 trillion ‘clearing’ market wholly within its jurisdiction post-Brexit, putting the City of London’s position as leader in this market in great peril. In this post we will review the obviously formidable response – including citing global systemic risk – but we shall also look at the underlying tone of the E.U.’s attempted move and what, in reality, it means for Britain as it heads, tepidly, into its negotiations with the E.U. over the terms of its secession – it seems the ‘ freedom ’ that was promised can only be achieved at the same time as experiencing remarkable loss and, assuming that “Leave” voters want to continue experiencing the trappings that come with a prosperous nation, everything will pretty much stay the same as before, except for one crucial difference. In terms of the actual substance to yesterday’s news, it is prudent to start off with a basic understanding of wh...

Less than 2 weeks ago it was announced that the French group PSA, owners of popular car firms Peugeot and Citroën, were in talks with America’s General Motors over the sale of its loss-making European business Opel (whose U.K. arm is branded as Vauxhall). In this post, the focus will not be on the potential issue regarding the protection of workers after a takeover, something which has been dominant in the British press, but rather on the potential systemic effects that may result from the further acceleration of PSA’s growth. Whilst the issue regarding the safeguarding of employees' positions and, crucially, their pensions is of the utmost importance, the recent news is that the jobs and the pension fund (albeit currently operating at a deficit of £840 million ) will be safeguarded until 2021 , which in the current turbulent climate is relatively secure unfortunately. So, for this post, the focus will be on a potential issue that is currently developing, and will arguably be ...

Even though the U.K. Parliament has not yet formally signalled its intent to the leave the European Union, the understanding that they will is causing fervent speculation in a number of different areas. This is arguably because of the almost-common understanding that leaving an economic and political bloc must result in seismic shifts, simply owing to the very nature of things. So, in this post the focus will be on this shift, with a specific reference to the notion of power . At this current stage of proceedings we are seeing conscious strategies coming into focus as the battle for financial supremacy in the region begins to intensify, and it is these strategies that can detail for us the likely course of action that the different parties will take. In renegotiating and reorganising, the U.K. is currently experiencing what is, essentially, an identity crisis; it has long been dependent upon its Financial Services sector , and has been recognised, globally, as being a leading fina...

This short blog post discusses the delicate predicament that British PM Theresa May is faced with in light of MP’s recent support for the triggering of Article 50 [1] . Whilst it may be obvious that any political leader will have to balance a number of competing interests, the job facing Theresa May is arguably more important. The decision of the British people to leave the European Union has forced the Government to focus on productivity and growth in preparation of leaving the bloc, as can be seen by the many Trade excursions taken by Mrs May in recent weeks. Yet, that position is one that can directly induce a lowering of standards, or a so-called ‘race-to-the-bottom, that may have an extremely damaging effect on the health of the British society (and potentially further afield due to the interconnectedness of modern society). This theoretical notion of the introduction of new levels of ‘regulatory arbitrage’ – where institutions will move between jurisdictions to receive a...