bill cobbett wrote:Ok, let's go with EU has "rights" business to do what it did to CY Banks last week ... and go on to perhaps agree that the EU also has responsibilities that go with these rights.
Let's start with the European Banking Authority...
The European Banking Authority is an organ of the EU and amongst its remit is...
..."The EBA acts as a hub and spoke network of EU and national bodies safeguarding public values such as the stability of the financial system, the transparency of markets and financial products and the protection of depositors and investors..."
In particular... any investor or depositor needs good info as to how safe the CY banks were judged.
So just what info were depositors given by the EBA as to the stability of CY Banks...??? Just how transparent were the markets and financial products to investors in CY Banks...??? ... and just how did the EBA act to protect depositors and investors...??
Well, some of the answers can be found in some stress tests that the European Banking Authority compelled almost all of the EU's banks to carry out some 18 month
ago, and, in the opinion of commentators, both the Laiki and the BoC were judged solvent and were both judged to have passed those tests.
So questions arise from these stress tests: Were depositors misled...??? and vitally important, was the European Banking Authority negligent in its work and if it was, then is it liable...???(For CF Bankers, who might give us more expert opinions, the stress tests for BoC are at ...
http://eba.europa.eu/pdf/bank/CY007.pdf and the stress test for Laiki is at...
http://eba.europa.eu/pdf/bank/CY006.pdf )
http://www.reuters.com/article/2012/06/ ... ZW20120628"....At the heart of the debate lies the issue of how far will national governments, whose supervisors sit on the EBA, give up regulatory sovereignty to centralized EU decision making.
Momentum is building behind the European banking union plan and the bloc's leaders will try to move it along at their summit on Thursday and Friday, with talk of some building blocks being in place in 2013.
"That would be ambitious but it would be doable in the context we are in," said David Wright, secretary general of the global securities watchdog IOSCO and former deputy chief of the European Commission's financial services unit.
A union would need a single banking regulator. But the EBA, made up of supervisors and central bankers from all 27 EU states, has shown in its short life that it lacks the power to be effective in that role without changes.
In June last year Helaba, one of Germany's biggest lenders, was about to fail the EBA's new "stress test" designed to test the capital strengths of individual banks across the European Union.
German regulator Bafin came out fighting, and accused the EBA of overstepping the mark and cobbling together new rules on capital. The Bundesbank weighed in too, saying the stress test was just a "show" for investors and Bafin allowed Helaba to pull out of the test two days before results were published...."
What this implies is that the EBA through the European Union doesnt have the authority to overstep a sovereign country's banking system and effectively give an accurate stress test to any bank in the EU....The EBA doesnt even have the authority to legally gain accurate information from a bank, it goes by what the individual banks, own statistics, which could be inaccurate which probably was the case in Laiki and Bank of Cyprus...
