EU may change rules governing conglomerates

Welcoming the proposals, the European Parliament’s economic and monetary affairs committee lauded the planned ban on the multiple gearing of prudential capital, where money set against risk in one subsidiary is earmarked for the same purpose in another.

The proposal would also improve coordination and the exchange of information among EU Member States, which, said MEP’s, would ‘help supervisory authorities obtain a clearer view’ of corporate financial affairs.

Indeed, the committee rejected a number of amendments limiting the Directive’s scope or diluting the multiple gearing ban.

The proposed changes affect credit institutions, insurance undertakings and investment firms within a conglomerate led by a EU head office, 40% of whose assets are in the financial sector.

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