EU-US must solve Basel II timetable problems

LONDON, October 18 (Global Risk Regulator) – Europe and the US need to find a pragmatic way forward on the home country-host country regulation issues opened up by their different timetables for implementing the Basel II bank safety rules, a top European Commission official said today.

"We have to find a sensible home/host relationship with the US," Patrick Pearson, the Commission’s head of unit for banking and financial conglomerates, told bankers in London. As the executive arm of the European Union, the Commission initiates financial regulation in the 25-nation EU bloc.

Pearson was joined by Britain’s top financial services regulator – Financial Services Authority (FSA) chairman Callum McCarthy who said EU banks with significant US operations and US banks with significant EU operations "will face problems with different timetables, which we will wish to see eased or solved if possible."

"The challenge for all of us is to use the time until January 2007 – a touch over 300 working days – effectively," McCarthy told an annual supervision conference organised by the British Bankers’ Association, the principal trade association for banks operating in the UK.

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