PARIS (Reuters) - The benefits of new international financial regulations risk being squandered to the detriment of growth if governments fail to better coordinate across borders, ECB Executive Board member Benoit Coeure said on Monday.
Speaking at a conference at the Bank of France, Coeure said governments were losing the enthusiasm for cooperating on regulation that came in the wake of the 2007-2008 financial crisis.
Spurred into action by losses that cost taxpayers dearly, regulators set about coordinating global financial rules after the crisis, tightening regulations for bank capital, derivatives and non-bank lenders.
However, divergences have emerged between some countries, with the United States and Europe in particular at odds over how to avoid future bank bailouts.
"I fear that this momentum is being lost," Coeure said. "I don't think this is good for global growth."
Without singling out any country in particular, Coeure warned there was "substantial risk" that financial systems would become more fragmented across borders if governments did not implement the new rules evenly and in ways that created a level playing field.
"There has to be the political impetus at least to preserve the instruments of international global cooperation," he said.
In that vein, he said the Group of 20 economic powers had to take seriously their Financial Stability Board, which is supposed to coordinate regulation among nations.
(Reporting by Leigh Thomas)