ECB's Nowotny says sees danger of over-regulation in banking sector

VIENNA: Regulators should not impose too many new rules on banks in the European Union but instead focus on measures that have proved to be reasonable, European Central Bank Governing Council member Ewald Nowotny said on Thursday.

"There is this legitimate feeling that the dynamics of imposing additional rules on banks in Europe has reached an end at least for now," the head of the Austrian central bank said at a panel discussion on the European economic and monetary union in Vienna.

"I see the danger that initially we deregulated too much and that we are probably heading into the other extreme of regulating a bit too much now." It would be reasonable to critically examine what new rules had proved to be reasonable and where regulation could be reduced, Nowotny said.