In his speech at the European Parliament's Plenary Session, Charlie McCreevy (European Commissioner for Internal Market and Services) discusses financial stability in Europe and a number of issues that arise from his preliminary thinking on the US sub-prime mortgage crisis and its potential impact on Europe. Among these, Mr McCreevy states that Basel II has improved opportunities to banks and investment firms to properly assess risks and to correctly calibrate their regulatory capital but that there will be implementing that require careful examinations by regulators. He also states that the prudential framework and bank risk controls have prevented hedge fund failures from triggering wider systematic disruption and raises concerns about the role of credit rating agencies.

View European Commission Speech - Financial stability and the impact on the real economy, 5 September 2007