Europe to create financial watchdogs

The European Parliament passed a law Wednesday creating watchdog institutions to oversee banking operations on all levels.

Photo: Reuters

The institutions aim to avoid the repetition of financial meltdowns by spotting threats before they hit home.

The decision to clamp down on its finance industry came as fears were renewed that Ireland, like Greece, is facing bankruptcy.

The new watchdogs will monitor banking, financial markets, insurance and pensions sectors.

A European board to oversee the health of Europe's economy will also be set up.
They will become active from the beginning of next year.

Parliamentary speaker Jerzy Buzek said "this new legislation will create a watchdog able to bark and -- if necessary -- to bite".

Michel Barnier, the former French foreign minister told lawmakers the measures would allow Europe to "avoid the recurrence of severe crises, protect consumers, and nourish
sustainable growth".

"Prevention is always cheaper than cure," Barnier added.