The EU supervisors warn of risk of malpractice … – ecodiario

The EU supervisors warn of risk of malpractice … – ecodiario

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The three supervisory authorities of the EU (banking, securities and insurance markets) have warned Monday of the risk to consumers and to the financial stability of the malpractices of selling financial products and handling index by banking

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BRUSSELS, 22 (EUROPA PRESS)

In its biannual joint report on the risks and vulnerabilities of the financial system of the EU supervisory authorities also expressed concern at the low growth in Europe, in an environment characterized by high indebtedness and enhanced search performance with low interest rates.

Supervisors highlighted the bad business practices of financial institutions such as the mis-selling of financial products and manipulation of indicators, remain a “substantial concern”.

“A key area of ​​concern has to do with inappropriate behavior in the financial sector, which poses risks both from a consumer perspective and financial stability,” said President Banking Authority Andrea Enria.

The report also warns that current good market conditions can hide fragilities in a weak economic environment. In particular, supervisors see risks in high debt and low growth in private sector credit and underscore the importance of continuing structural reforms to improve competitiveness. They also claim to continue repairing the balance sheets of banks and debt restructuring.

The study calls for increased efforts to address the risks associated with information technology and cyber attacks.

As for the financing conditions, accommodative monetary policy and unconventional measures taken by central banks have improved the situation, but low interest rates have increased pressure for insurers, pension funds and managers asset.

In particular, the protracted nature of the environment of low interest rates has intensified the search for higher yields by investors, which increases the risk for the valuation of the assets of a change sudden.

Finally, the report highlights the risk that the financial institutions of the EU are affected by political and economic uncertainties in several emerging economies, with a special reference to the impact of the conflict between Russia and Ukraine.

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