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ABI calls for single EU prudential supervisor debate

The Association of British Insurers is calling for the consideration of a single prudential supervisor across the European Union as part of its plan to help restore confidence and trust in European financial services.

Its latest report, The Insurance Industry: Rebuilding Confidence in Europe, outlines the trade body’s priorities for Europe and sets out key principles for a global recovery.

The ABI is calling for a debate in the long term over the feasibility of a single prudential supervisor, to overcome the current lack of trust between European regulators.

It is also proposing better use of the information exchange offered by colleges of supervisors and more resources for level three committees, which bring together European regulators in specific financial sectors.

The launch came as the ABI board met in Brussels for discussions with senior European officials and MEPs.

The report also includes principles to underpin any new legislation or proposed solutions to reform financial supervision. These include the need for better, targeted regulation and risk and principles-based regulation as opposed to light-touch.

ABI director general Stephen Haddrill says: “Decisive but considered action is needed from Brussels. Confidence and trust must be regained, and calls for protectionism challenged. We must now look carefully at both radical and evolutionary ways forward, including the possibility of a single European prudential supervisor. Consumers and businesses deserve all options to be explored to ensure we emerge from this crisis stronger.

“Insurers are weathering the financial storm and have a key role in protecting EU citizens and businesses. As both operators and investors in Europe, the UK insurance industry is an important voice in this debate.”

ABI chairman and Lloyds Banking Group group executive director of insurance Archie Kane says: “What happens in Brussels is critical to the UK insurance industry, which is the largest in Europe. It is now a crucial time to engage with European officials and regulators, and holding our board meeting in Brussels alongside the launch of this report, shows the determination of the ABI to make sure the views of UK insurers are heard.”

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The best thing since sliced bread is an expression I have never understood as I don’t rate sliced bread. For me, it is a half-baked expediency, an apology for the real thing – a bit like some thoughts on improving financial services.

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