Linklaters Luxembourg holds annual client event on the future of financial regulation
From left to right: Ralf Jansen (General Counsel, Member of the Management Board, European Stability Mechanism), Jean Guill (Director General, Commission de Surveillance du Secteur Financier), Patrick Geortay (capital markets and banking partner, Linklaters Luxembourg),
From left to right: Ralf Jansen (General Counsel, Member of the Management Board, European Stability Mechanism), Jean Guill (Director General, Commission de Surveillance du Secteur Financier), Patrick Geortay (capital markets and banking partner, Linklaters Luxembourg),Scott Bowie (investment management partner, Linklaters New York) and David Ereira (banking partner, Linklaters London)
The current wave of new regulation for the banking sector may, possibly, be starting to ease, guests from Luxembourg’s business community heard at Linklaters’ Magenta Horizons client reception on Wednesday, January 21.
However, members of a panel discussing the future of financial regulation agreed that the sector still has its hands full coping with new measures introduced since the financial crisis, and their long-term implications, including consolidation in the financial industry, with its implications for systemic risk.
The evening was introduced by Luxembourg managing partner Freddy Brausch, who interviewed the firm’s London-based managing partner, Simon Davies, on the clients’ evolving expectations from their legal advisers.
“The nature of advice has changed since the crisis,” Davies said. “Clients are more likely to seek your judgement than before, and an intense focus on costs is now giving way to discussions about value.”
The discussion panel comprised Jean Guill, director-general of Luxembourg regulator CSSF, Ralf Jansen, a member of the management board of the European Stability Mechanism and Linklaters partners Scott Bowie (New York), David Ereira (London) and Patrick Geortay (Luxembourg).
They highlighted the importance of new developments such as the assumption of overall regulatory responsibility by the European Central Bank and the creation of a comprehensive resolution mechanism, including the ESM and the recent bank stress tests, to deal with the fallout of any future crisis that threatened banks’ solvency.
Regulators must also respond to the trend of alternative lenders taking up the slack of providing financing to the economy as it spreads from the US to Europe, and the role of alternative investment managers in acquiring existing non-performing debt from banks.