ECB’s Lagarde Calls for Non-Banks to Face Tougher Scrutiny (1)

European Central Bank President Christine Lagarde warned against lowering standards in banking regulation, arguing that scrutiny of non-banks must be strengthened instead.

After years of enhancing supervision since the Great Financial Crisis, it’s time to take a closer look at the rules financial institutions need to comply with and check whether some can be simplified, Lagarde said Friday. She sees the rise of non-banks as a phenomenon that threatens to create an “uneven playing field,” adding urgency to the task.

“It is vital that policymakers adapt regulation and supervision to this challenging environment,” she said in Amsterdam. “They should do ...