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Guardian.co.uk – Sweden is trying to water down moves to toughen regulation of hedge funds and private equity firms before its EU presidency expires at the end of the year.
In new proposals the Swedes have suggested withdrawing a cap on the amount that hedge funds can borrow to make investments, an official from the country said.
“We would leave it up to the competent authorities to decide whether to impose the caps in each case,” said the official, who did not wish to be named.
The Swedish Wire – Sweden, which holds the rotating EU presidency, is consulting European capitals and “most of them are positive” about the idea, said Roberta Alenius, spokeswoman for Swedish Prime Minister Fredrik Reinfeldt.
“The prime minister wants a summit if it is really needed, and if it gives a common position before the Pittsburgh meeting” on September 24-25, she added.
EU member states have already agreed among themselves to boost surveillance of the banking and insurance sectors as well as hedge funds.
The Independent – Grimly aware that a European Commission crackdown on regulation of hedge funds and private equity spells disaster for the EU’s predominantly London-based industry, Treasury ministers have been desperately lobbying their counterparts in Brussels for months, but their pleas have fallen on deaf ears.
Now, however, the Americans have woken up to the fact that many of their hedge funds would find it impossible to do business in the EU under proposals for regulatory reform. In recent weeks, US Treasury officials have thus been touring the EU, letting their displeasure be known.
It appears that the Americans’ involvement is already paying dividends. Sweden, which holds the EU presidency, was quietly letting it be known yesterday that it will ensure some sort of compromise is brokered. The Alternative Investment Management Association, which represents the sector’s interests, now thinks disaster may be averted.
guardian.co.uk – A minister for Sweden, which took over the EU presidency on Wednesday, said hedge funds and private equity firms needed regulation but should not be viewed as a primary cause of the global financial crisis.
Speaking after a visit by the European Commission to Stockholm to mark the Nordic country’s start in the six-month presidency, Financial Markets Minister Mats Odell cautioned against "overzealous" regulation.
What was needed, he told Reuters, was well-considered, balanced regulation that helped avoid systemic risk.
"I believe there is an exaggerated view in some countries that private equity and hedge funds helped pull us into the crisis," Odell told Reuters.
