City banking partners have welcomed plans to usher in centralised supervision of Europe’s biggest banks announced yesterday (13 December) but warned that increased regulation could have a negative impact on liquidity.
European finance ministers yesterday agreed to hand over nations’ individual responsibility for bank regulation to the European Central Bank (ECB) in Frankfurt, which will supervise up to 200 of Europe’s largest banks. It should pave the way for direct recapitalisation of struggling banks by the European Stability Mechanism rescue fund.
