Forbes – Some large banks in the European Union may have been forced to compromise on due diligence when dealing with hedge funds because of competitive pressures, said Edgar Meister, chairman of the ECB’s Banking Supervision Committee.
‘It cannot be excluded that competitive pressures may have forced some prime brokers to compromise on due diligence when dealing with hedge funds,’ Meister said, presenting a report on EU banking sector stability.
‘We have to take into account that the links between large EU banks and hedge funds are intensifying,’ said Meister, who is also a management board member of the Bundesbank.
Meister said new practices are arising between large banks and hedge funds and are quickly establishing themselves as common standards.
