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FSA advises EU on mortgage integration

Ramesh Sharma

June 1, 2004

Speaking at a hearing in Brussels, Dan Waters, director of retail policy at the FSA, said while he welcomed the inquiry into the barriers to integration and the case for intervention to overcome these, there was little evidence of the possibility of full integration as defined by the Commission.

He said: “National markets will retain many cultural and behavioural differences which will make it difficult to realise the full benefits of integration. The Commission should recognise this and focus on areas where the greatest gains are to be had and where the costs are the least such as developing secondary market funding instruments and exploring voluntary measures such as standards for property, valuation and improving land registers.”

The Council of Mortgage Lenders (CML) has also urged the Commission to concentrate on measures that will make it easier to do business across different member states rather than just focusing on harmonising consumer protection. It said the most important differences to tackle are the variations in access to credit data about borrowers, land registration systems and mechanisms to take possession of property but the Commission appears not to be focusing primarily on this at present.

Michael Coogan, CML director-general, said: “I believe if integration is going to happen across Europe it will be driven by lenders’ commercial decisions to become more inter-national in their mortgage operations. Successful integration won’t be driven by consumer demand or by harmonised consumer protection measures.”

He added: “There’s an important role for the EU Commission to promote measures to improve national and cross-national co-operation on legal and collateral issues. This should deliver real benefits to lenders and to their customers.”


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