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Elemér Terták |
Keynote speaker Elemér Terták, principal advisor, financial institutions, DG Internal Market & Services at the European Commission, offered Global ABS 2011 attendees little new insight into the thinking of regulators, instead vowing to deny the European securitization market a repeat of mistakes made in the past.
Speaking at the Information Management Network conference in Brussels this morning, Terták ticked off securitization’s “seven deadly sins,” naming the originate-to-distribute model, servicing conflicts, investor overreliance on credit rating agencies and the diffusion of risk into the global financial markets as the main “wounds of securitization.”
The bulk of the speech covered the familiar laundry list of regulatory initiatives. Proposed remedies included the ongoing push by regulators to increase core capital reserves among banks and the need to establish a derivative clearing houses. Also mentioned was the need for banks to increase disclosure of their trading book exposure to securitizations, as well as stronger supervision,....