“Securities watchdogs have inadequate resources to cope with their new regulatory responsibility for monitoring systemic risk, the EU’s top markets regulator has warned.

“Steven Maijoor, chairman of the European Securities and Markets Authority , said legislation passed last week by the European parliament amounted to the “biggest overhaul of the capital markets in a generation” – but warned that the authorities had a long way to go before putting the regime into practice.

“The legislation gives Esma an increased role in not only setting rules but also monitoring activity in European markets, including derivatives markets, for the first time.

“Securities regulators have in the past had a strong focus on investor protection but much less of a tradition of looking at risks to stability and risks in financial markets,” Mr Maijoor pointed out in an interview with the Financial Times.”

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Read full Financial Times article here.