Financial Regulation Essay

Instead, the core of the financial system became a key channel of propagation and magnification of losses suffered in the housing market.

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At the international level, there is the International Organization of Securities Commissions (IOSCO), the International Association of Insurance Supervisors, the Basel Committee on Banking Supervision, the Joint Forum, and the Financial Stability Board, where national authorities set standards through consensus-based decision-making processes.

Think-tanks such as the World Pensions Council (WPC) have argued that most European governments pushed dogmatically for the adoption of the Basel II recommendations, adopted in 2005, transposed in European Union law through the Capital Requirements Directive (CRD), effective since 2008.

The objective of monitoring compliance by listed companies with their disclosure requirements is to ensure that investors have access to essential and adequate information for making an informed assessment of listed companies and their securities.

Banking acts lay down rules for banks which they have to observe when they are being established and when they are carrying on their business.

In essence, they forced European banks, and, more importantly, the European Central Bank itself e.g.

when gauging the solvency of EU-based financial institutions, to rely more than ever on the standardized assessments of credit risk marketed by two private US agencies- Moody's and S&P, thus using public policy and ultimately taxpayers’ money to strengthen an anti-competitive duopolistic industry.

The trading acts demands that listed companies publish regular financial reports, ad hoc notifications or directors' dealings.

Whereas market participants are required to publish major shareholder notifications.

In most cases, financial regulatory authorities regulate all financial activities.

But in some cases, there are specific authorities to regulate each sector of the finance industry, mainly banking, securities, insurance and pensions markets, but in some cases also commodities, futures, forwards, etc.