Europe's new financial services chief signaled differences with the U.S. over how to overhaul banking regulations, saying he wants binding rules on pay and rejecting as wrong for Europe President Barack Obama's plans to limit banks' size and risky trading.
In his first press conference since taking office, Frenchman Michel Barnier said he wants "binding rules on remuneration throughout the financial sector."
He didn't give a time frame for making detailed proposals, which would have to be approved by EU governments and the European parliament.
Barnier, whose appointment as EU commissioner in charge of EU financial markets raised hackles in London after French bashing of so-called unfettered "Anglo-Saxon" finance, said he will shortly be traveling to Washington and New York to discuss global efforts to overhaul the financial system.
He said Obama's proposals to limit the size and investments of banks won't work in Europe.
"We can't transpose or copy response by Obama to the European continent," he said in a press conference after a two day meeting of European finance ministers.
"We don't have the same banking structure on both sides of the Atlantic. In Europe there are more problems with interconnection of banks rather than specific nature of operations or scale of individual banks."
Last month Obama advocated changes put forward by former Federal Reserve Chairman Paul Volcker including a proposal to ban banks that take government-insured deposits from trading stocks for their own profit.
The change would restore some of the separation of commercial banks from investment banks, a line that was removed a decade ago by the repeal of the Depression-era Glass-Steagall Act.
According to a briefing note given to finance ministers and obtained by The Associated Press, European officials "expressed their concern that the application of the Volcker rule in the EU may not be consistent with the current principles of the internal market and universal banking."
The Feb. 10 memo was prepared by top finance officials from 27 EU nations.
"The focus should be on reaching a common understanding at the global level on which are the riskiest activities, on how risks are concentrated in them and on how they are interconnected," the three-page note said.
The memo also raised questions about Obama's intention to introduce a new tax on banks to recoup the cost of bailing out foundering firms at the height of the financial crisis, which it said would apply to eight European banks.
The measure would "raise level playing field issues among cross-border banks," the note said.
Barnier also told EU finance ministers that he wants new rules to deal with potential future crises, according to his office. These could include tools for early intervention or which allow for the restructuring of insolvent banks.
He also wants to strengthen the responsibility and the independence of management boards, and to look at the role of shareholders and external audit, his office said.
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