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

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.