GLOBAL AND REGIONAL REGULATORY CHANGES TO THE FINANCIAL INDUSTRY AS A CONSEQUENCE OF THE FINANCIAL CRISIS: THE CASE OF THE EUROPEAN UNION
GLOBAL AND REGIONAL REGULATORY CHANGES TO THE FINANCIAL INDUSTRY AS A CONSEQUENCE OF THE FINANCIAL CRISIS: THE CASE OF THE EUROPEAN UNION

Author(s): Roberto J. Santillán-Salgado
Subject(s): Economy, Supranational / Global Economy
Published by: ASERS Publishing
Keywords: financial crisis; financial industry; regulation
Summary/Abstract: Since the first signs of the financial crisis appeared during 2007, several national governments announced initiatives to implement extensive bailout measures and recovery plans backed up with tax-payers money. The official language was very similar in all countries; extraordinary measures were required to avoid a systemic collapse that could endanger economic stability. However, it was during the Global Finance summit that took place in London in November of 2008 that the most industrialized and the biggest emerging economies agreed on the implementation of a global financial reform to close loopholes in regulation and supervision. While the discussion about the origins and consequences of the recent Financial Crisis will be an ongoing topic for many years to come, a number of national governments, regulatory agencies and international financial organizations, have already taken important steps and towards the implementation of new regulatory frameworks, as well as more robust supervision mechanisms of the financial industry.This chapter briefly discusses the antecedents of Financial Regulation in the European Union, as well as the political and institutional responses of governments to the Financial Crisis of 2007-2009. As a result of our critical analysis, we conclude there is no doubt of the interest of national authorities to minimize the probability of a repetition of a systemic financial stress episode or, worse yet, another fully fledged financial crisis; but the challenge to conciliate so many legislations, political interests and economic interests is not a trivial matter.

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