Activities of Syed KAMALL related to 2012/2115(INI)
Shadow reports (1)
REPORT on Shadow Banking PDF (182 KB) DOC (98 KB)
Amendments (19)
Amendment 4 #
Motion for a resolution
Recital A a (new)
Recital A a (new)
Aa. whereas regulated entities in the regular banking system take part extensively in those activities defined as part of the shadow banking system, and are in many ways interconnected with shadow banking entities;
Amendment 19 #
Motion for a resolution
Recital E
Recital E
E. whereas SB as a global phenomenon requires a coherent global regulatory approach, based on FSB recommendations as well as any other relevant national or supranational regulatory bodies;
Amendment 22 #
Motion for a resolution
Paragraph 1
Paragraph 1
1. Welcomes the Commission's Green Paper as a first step towards the stricter monitoring and supervision of SB; endorses the Commission's approach based on indirect regulation of SB, at the same time underlining the need for direct regulation of some of its aspects in a functional way while avoiding overlap and ensuring consistency with existing regulations, where existing regulation is found to be insufficient and where impact assessments have shown absolute necessity;
Amendment 28 #
Motion for a resolution
Paragraph 2
Paragraph 2
2. Agrees with the FSB's definition of SB as ‘a system of intermediaries, instruments, entities or financial contracts generating a combination of bank-like functions but outside the regulatory perimeter or under a regulatory regime which is either light or addresses issues other than systemic risks, and without access to central bank liquidity facility or public sector credit guarantees’; underlines the challenge involved in implementing this definition in a monitoring, regulatory and supervisory context;
Amendment 31 #
Motion for a resolution
Paragraph 2 a (new)
Paragraph 2 a (new)
2a. underlines the challenge involved in implementing this definition in a monitoring, regulatory and supervisory context; emphasises that existing regulation already has had and will have far-reaching effects on the shadow banking system; urges that duplication and replication of regulation is avoided as far as possible to ensure regulatory arbitrage is made as difficult as possible;
Amendment 32 #
Motion for a resolution
Paragraph 3
Paragraph 3
3. Points out that since the crisis some of the practices of SB have vanished; notes, however, that the innovative nature of the SB system may lead to new developments that may pose a source of systemic risk, which should be tackled; stresses, therefore, the need to collect more and better data on shadow banking transactions, market participants, financial flows and interconnections, in order to obtain a full overview of the sector, while recognising that 'data overload' could make the gathering of this information counterproductive;
Amendment 37 #
Motion for a resolution
Paragraph 4
Paragraph 4
4. Believes that a fuller overview and better monitoring and analysis will allow the identification of both those aspects of the SB system which have beneficial effects for the real economy and those raising concerns related to systemic risk or regulatory arbitrage; sStresses the need for stronger risk assessment procedures, disclosure and oversight, for all institutions presenting a concentrated risk profile with systemic relevance;
Amendment 42 #
Motion for a resolution
Paragraph 5
Paragraph 5
5. Supports, therefore, as a first step, the creation by the ECB of a central EU the exploration of whether a database on euro repo transactions, and invites the Commission to submit a legislative proposal for the creation of such a database by the end of 2013, after undertaking a feasibility study in relevant currencies would be helpful to regulators to identify systemic risk; urges the Commission to undertake a feasibility study and impact assessment and, subject to understanding links to existing data repositories in the context of other regulatory initiatives, put forward ideas for possible legislative proposals;
Amendment 54 #
Motion for a resolution
Paragraph 6
Paragraph 6
6. Stresses, further, the need to obtain a fuller overview of risk transfers by financial institutions, in order to determine who has purchased what from whom and how the transferred risks are supported; inviturges the Commission, therefore, to undertake a study (in early 2013)feasibility study and impact assessment and, submit a report (by mid-2013) regarding the feasibility of setting up a public non- profit utility as a central registry for risk transfers, which should be able to capture and monitor risk transfer data in real timeject to understanding links to existing regulatory initiatives, put forward ideas for possible legislative proposals;
Amendment 64 #
Motion for a resolution
Paragraph 7
Paragraph 7
7. Stresses that theseshould new tasks will requirebe necessary, a sufficient level of new resources may be required that should come from the existing EU budget;
Amendment 66 #
Motion for a resolution
Paragraph 8
Paragraph 8
8. Emphasises that some SB activities and entities may be either regulated or unregulated depending on the country; notes further that the financial interdependence between the banking sector and shadow banking entities is currently excessiat a high level;
Amendment 70 #
Motion for a resolution
Paragraph 8
Paragraph 8
8. Emphasises that some SB activities and entities may be either regulated or unregulated depending on the country; notes further that the financial interdependence between the banking sector and shadow banking entities ican be excessive; notes cfurrently excessivther that supervision is only as good as underlying legislation and vice versa and underlines the danger of supervisory and /or legislative arbitrage;
Amendment 77 #
Motion for a resolution
Paragraph 9
Paragraph 9
9. Stresses that the reports of the Committee on Economic and Monetary Affairs on CRD IV2 , currently being discussed with the Council, represent an important step in tackling shadow banking in a positive way by imposing capital treatment of liquidity lines to structured investment vehicles and conduits, and by setting the large exposurBelieves further that the extension of capital requirements, bank-type regulation and supervision to certain non- bank finance companies and securities dealers that are financed materially by short-term debt and that are not covered by the definition in the Capital Requirements Regulation (CRR) needs careful consideration ; believes that firms taking similar risks should be regulated in similar manner but also recognises the need to ensure that there is not a disproportionate limit of 25% of own funds for all unregulated entitiepact on non-lending investment firms which may be better regulated through legislation relating to investment firms than as credit insititutions;
Amendment 80 #
Motion for a resolution
Paragraph 9
Paragraph 9
9. Stresses thatTakes note of the reports of the Committee on Economic and Monetary Affairs on CRD IV2 , currently being discussed with the Council, represent an important step in tackling shadow banking in a positive way by imposingwhich propose the imposition of capital treatment of liquidity lines to structured investment vehicles and conduits, and by setting the large exposure limit of 25% of own funds forto all unregulated entitiesexposures to such entities; recognises that the latter proposal needs further consideration given the serious impacts this could have on funding of the real economy, for example in vehicle finance;
Amendment 85 #
Motion for a resolution
Paragraph 10
Paragraph 10
10. Believes further that the proposed extension of CRD IV to non-deposit- capital requirements, bank-type regulation and supervision to certaking non- bank finance companies not covered by the definition in the Capital Requirements Regulation (CRR) is necessaryand securities dealers that are financed materially by short-term debt and that are not covered by the definition in the Capital Requirements Regulation (CRR) needs careful consideration; believes that firms taking similar risks should be regulated in similar manner but also recognises the need to ensure that there is not a disproportionate impact on non-lending investment firms which may be better regulated through legislation relating to investment firms than as credit insititutions;
Amendment 100 #
Motion for a resolution
Paragraph 13
Paragraph 13
13. Takes note of the importance of the repo and security lending market; inviturges the Commission to adopt measures, by the beginning of 2013, to increase transparency, as well as to allow regulators to impose minimum haircuts or margin levels for the collateralised financing marketundertake a feasibility study and impact assessment and, subject to understanding links to existing regulatory initiatives and having identified the systemic relevance of a specific activity, put forward ideas for possible legislative proposals;
Amendment 107 #
Motion for a resolution
Paragraph 14
Paragraph 14
14. Believes that incentives associated with securitisation need to be adequately addressed; inviturges the Commission to examine the securitisation market and to submit a legislative proposal at the latest by the beginning of 2013 for limiting the number of times a financial product can be securitisedundertake a feasibility study and impact assessment and, subject to understanding links to existing regulatory initiatives, put forward ideas for possible legislative proposals; calls on it to impose particular requirements on suppliers of securitisation (e.g. originators or sponsors) to retain part of the risks associated with securitisation and of measures to achieve transparency, by the introduction of an external valuer of the underlying assets and standardisation of securitisation products as well as resolution processes; calls on the Commission to look at loss provisioning for securitised products and for the underlying asset to be directly linked to the securitised product;
Amendment 118 #
Motion for a resolution
Paragraph 15
Paragraph 15
15. Recognises the important role money market funds (MMFs) fulfil in the financing of financial institutions, sovereigns and non financial corporates in the short run and in allowing for risk diversification; recognises the different role and structure of MMFs based in the EU and the US; recognises that the 2010 ESMA guidelines imposed stricter standards on MMFs (credit quality, maturity of underlying securities and better disclosure to investors); notes, however, that some MMFs, in particular those offering a stable net asset value to investors, are vulnerable to massive runs; stresses, therefore but that these standards remain less stringent than those introduced in the USA in 2010 to Rule 2a- 7 funds; notes that MMFs, both VNAV and CNAV, may experience outflows of funds from certain types of bad debt, in particular bank debt and sovereign debt during periods of financial instability; highlights that investors in these funds appear to be aware that MMFs are not guaranteed, even if these funds are CNAV, and that changes introduced in the USA in 2010 were stress-tested in 2011 during a period of market instability; believes, however, that additional measures may need to be taken in the EU as part of the UCITS 6 review to improve the resilience and transparency of these funds and to cover the liquidity risk; invites the Commission to submit a legislative proposal at the beginning of 2013 requiring MMFs either to adopt a variable asset value with a daily evaluation or, if retaining a constant value, to be subject to capital requirements; , while also noting that capital buffers/requirements or mandatory redemption restrictions would render MMFs uneconomical, resulting in funds currently residing in them shifting to bank deposit accounts leading to a further concentration of risk;
Amendment 124 #
Motion for a resolution
Paragraph 16
Paragraph 16
16. Recognises the benefits Exchange Traded Funds (ETFs) provide by giving retail investors access to a wider range of assets (such as commodities, in particular), but stresses the risks ETF carry in terms of complexity, counterparty risk, liquidity of products and possible regulatory arbitrage; inviturges the Commission, therefore, to submit a legislative proposal at the beginning of 2013 to tackle these potential structural vulnerabilitieso undertake a feasibility study and impact assessment and, subject to understanding links to existing regulatory initiatives, in particular UCITS and ESMA ETF guidelines, put forward ideas for possible legislative proposals, if necessary;