The EU-U.S. Joint Financial Regulatory Forum convened on December 4-5, 2024, to discuss mutual interests within the financial regulatory dialogue. The forum was co-chaired by the U.S. Department of the Treasury and the European Commission.
Representatives from several European bodies, including the European Commission, European Banking Authority (EBA), and others participated in the discussions. From the U.S., participants included representatives from independent regulatory agencies such as the Federal Reserve Board (FRB) and Securities and Exchange Commission (SEC).
The forum emphasized ongoing cooperation between the U.S. and EU across various areas, focusing on themes such as market developments, operational resilience, digital finance, anti-money laundering (AML/CFT), sustainable finance, banking, insurance, and capital markets.
“Participants started the conversation by focusing on financial stability and market developments,” noting persistent downside risks amid geopolitical tensions despite moderating inflation globally.
Concerns were raised about asset valuations remaining high relative to fundamentals in several asset classes. “Participants highlighted the importance of implementing robust prudential regulatory frameworks,” discussing strong regulatory standards for internationally active banks.
There was an exchange of views on artificial intelligence in financial services concerning opportunities, challenges, regulation implications, supervision, and financial stability. Both sides showed interest in continuing this discussion internationally.
EU participants updated their work under various regulations like Digital Operational Resilience Act (DORA) while U.S. participants shared updates on frameworks like Treasury-FRB Critical Providers Dialogue.
In terms of consumer financial data management regulations within jurisdictions: “U.S. participants provided an update regarding ongoing work on the Financial Data Transparency Act.”
Updates were also exchanged regarding anti-money laundering efforts with discussions around potential illicit finance risk related to stablecoins.
The forum covered sustainable finance issues including climate disclosures while exchanging updates about international sustainable finance developments through groups like G20’s Sustainable Finance Working Group.
Banking proposals were discussed along with progress towards Basel III reforms implementation aiming at enhancing system stability. Updates followed regarding negotiations surrounding crisis management frameworks alongside securities law interactions tied to open bank bail-in operations highlighting effective resolution frameworks cross-borderly too.
Capital markets saw discussions around settlement cycle shortening updates shared by EU participants; meanwhile SEC gave insights into lessons learned six months post-migration onto T+1 timeline sharing observations alongside rule updates concerning clearing US Treasuries coupled with fund reform exchanges further involving macroprudential reviews Non-Bank Financial Institution space proposal Savings Investment Union mention too among topics addressed during sessions held together finally concluding closure remarks relaying FATCA-related closing notes issued from US side acknowledging forums’ significance fostering continued dialogue promoting bilateral communications supporting key goals stabilizing finances investor protection maintaining integrity ensuring equal playing fields throughout regions involved ahead next anticipated summer meeting 2025 planned future engagements aimed extending collaborative initiatives alike moving forward accordingly thereafter proceeding subsequent gatherings alike following thereafter forthcoming periods respectively thereafter…
