Draghi defends that the regulation of the banking sector must not back down – Yahoo Finance Spain

FRANKFURT (Reuters) – The banking sector overall needs to be well regulated and the measures already decided on should not be withdrawn, said on Friday Mario Draghi, president of the European Central Bank, with growing concerns that the new american administration may be more flexible banking rules.

The regulation of banks has to enter a period of stability and there is no need to redesign the rules, said Draghi at a conference, arguing that the deregulation excessive was the main cause of the global financial crisis.

The victory in the presidential elections, Donald Trump has increased the hopes of some and the concerns of others that are for back-up on the part of bank regulation in the last decade, giving the banks a respite, but increasing potential systemic risks.

“we Should focus on the implementation, not in the redesign,” said Draghi. “Regulatory measures should be implemented in a balanced way to ensure equal conditions at the global level”.

“Although they are possible some settings are marginal, there should not be a setback in what has already been decided,” added the president of the institution which oversees the largest banks in the euro zone.

The new regulation has led to a greater banking solvency and a better quality of assets, in addition to help Europe to reduce its levels of delinquent loans.

In January, should be finished a new series of measures known as Basel III, which would come into force in 2019 after years of tough negotiations.

After years of stimuli without precedent, Draghi said that the ECB will now focus on whether the recovery of the inflation in the euro zone can be maintained even if reduced monetary stimulus extraordinary from the ECB.

“In the future, our assessment will depend on whether we see a fit sustained on the path of inflation toward this target,” said Draghi at a conference in Frankfurt.

“And that means that the convergence of inflation toward the 2 percent to be sustainable, even with a reduction of monetary easing. The dynamics of inflation, in other words, they need to sustain themselves autonomously”.

inflation Is expected to increase by over 1 per cent early next year after having skimmed the deflation for a year. However, the figure is still far from the goal of the ECB of close to 2 percent.