Should the European Union, under circumstances, be able to force member states to provide financial aid to banks that are at risk of bankruptcy? Or is this too big a violation of a nation’s sovereignty?

These were the stakes at a recent EU summit in Brussels, where cross-border financial regulation was the topic of discussion.

Warn and act
The proposal was to set up a European System of Financial Supervisors that monitors banking, insurance and securities involving two or more member states – in cooperation with national governments.

(more…)

Reduce the influence shareholders have on banks by 50% and instead appoint a council that keeps watch over the public interest.

This way, not only individual interests but also the greater common good is taken into consideration when a bank sets out a course for the future, say Prof. Michiel Scheltema and Arjan Scheltema.

Michiel Scheltema is former chairman of the Dutch ‘Wetenschappelijke Raad voor het Regeringsbeleid’ (Scientific Council for Government Policy) and together with his son Arjan Scheltema he wrote an advisory report for the ‘Vereniging voor Effectenrecht’ (Association for Securities Law) in which they plead the above measures.

(more…)

Governments should stop giving financial support to suffering banks. Let the banks topple over and let corporations find the money they need for investments elsewhere, for instance by issuing bonds. Banks can then focus on providing basic financial services, such as transaction services.

These are the views of Aaron Brown, US based fund manager and financial risk expert, according to a recent article in Dutch newspaper Het Financieele Dagblad.

(more…)

The US Bank has recently tapped into the consumer’s desire to decrease healthcare costs and increase control.

They did this by creating the Health Savings Account (HSA), which is paired with a High-Deductible Health Plan (HDHP).

(more…)

Since a couple of decades, the paper money in your pocket is no longer backed by gold bullion in the national reserve’s safes. It is instead backed by the government’s assurance that the printed paper is accepted currency for taxes.

The value of money is established by governments, or to be more precise: by central banks. This allows central banks to control the rate of inflation and thus maintain economic stability. A growing group of people however are advocating a return to the gold standard, where every Euro and Dollar represents an equal value in gold.

(more…)

Banks and financial service providers should do their best to address ethnic groups that speak non-native languages.

This is extra urgent if they’re still unfamiliar with the financial services that are offered.

To do this, not only should these groups be addressed in their own language, but also through the specific information channels they use. The question is of course whether the potential revenue increase outweighs the effort made in specialized ad campaigns.

(more…)

Traditionally, banks have presented themselves as solid and unyielding organizations. Even the traditional architecture of banks reflected this: solid buildings with stone pillars and heavy doors. This image of solidity provided an air of reliability, the idea that your money was safe.

Of course this image has been severely battered over the past months, and banks all over the world have to find a new way to relate to their clients. Still, many banks have trouble letting go of their old ways, and continue to position themselves as fixed institutions rather than flexible financial service providers.

(more…)