News release: “If European policymakers, big financial institutions and social partners cannot agree on the full extent of reform, then Europe’s financial services sector runs the risk of being plunged back into the unsustainable situation of chasing short-term profit with high risks, Eurofound’s European Monitoring Centre on Change (EMCC) warns in a new report. The new report outlines potential adaptation scenarios for the European financial sector in the aftermath of the financial crisis. The global debate on new regulatory rules for the financial sector in the aftermath of the current economic crisis is producing a flood of arguments, suggestions and proposals. Different restructuring and adaptation approaches are competing and it remains unclear which one will be the future for European financial services. New research launched by Eurofound’s European Monitoring Centre on Change (EMCC) shows that the financial services sector is dominated by companies that have re-focused on their core business in an effort to return to profitability, albeit at the expense of considerable job cuts. In 2009, roughly 10% of jobs in the state-owned banks examined were cut, compared to around 5% in the surveyed private banks following a liberal business model. One part of the European financial sector is in state ownership, and some institutions will remain under this control for a longer period of time, the report found. A second part of the sector, which is building up a sustainable business model, performed with minor job losses. A third group continues to deal in liberal capital markets with a strong profit orientation.” [Stuart Basefsky]