Morning Bell        Study: EU financial-transaction levy could hit tax revenues A proposed EU tax on financial transactions could reduce, rather than increase, overall tax revenues, according to a study by economic consultancy Oxera and commissioned by AFME. Financial Times (tiered subscription model)(10 Jan.) Sarkozy insists France must move forward with Tobin tax: French President Nicolas Sarkozy said France must lead the way on a financial-transaction tax despite concerns that going it alone might damage the country's financial-services industry. Financial Times(tiered subscription model)(10 Jan.) Merkel's party will push for financial-transaction tax: Germany's Christian Democrats, the party of Chancellor Angela Merkel, will press for the EU to implement a tax on financial transactions, a senior lawmaker said. The UK and Sweden oppose the tax, but Merkel favours the move with or without their support. Reuters(10 Jan.)

• Other News

Fitch says it likely won't cut France's rating this year
The Telegraph (London) (10 Jan.)

European banks embrace bond markets in first 10 days of 2012
The Wall Street Journal (10 Jan.)

Ireland plans eventual return to bond markets, minister says
Reuters (10 Jan.)

Regulatory Roundup

FSB might expand definition of "too big to fail" firms
The Financial Stability Board is considering broadening the definition of firms deemed "too big to fail" to include insurers, clearinghouses and domestic banks. The move would subject such companies to capital rules designed for the largest financial institutions in the world. "The world contains a whole slew of institutions like that which are not systemic on a global level but are on a national level," said Simon Gleeson, a regulatory lawyer at Clifford Chance. Bloomberg(10 Jan.), Reuters(10 Jan.)

Group questions idea of organised trading facilities
The European Commission, as part of its overhaul of over-the-counter derivatives markets, proposed that organised trading facilities sit between exchanges and OTC contracts. However, the Federation of European Securities Exchanges said OTFs would allow financial institutions to avoid tougher rules followed by exchanges. "The OTF idea is waiving or eliminating some of the core protections [the Markets in Financial Instruments Directive] had put on trading venues in terms of access and execution," said Burcak Inel, FESE's deputy secretary general. "The new MiFID would create certain trading platforms which are lighter regulated." Reuters(10 Jan.)

BoJ governor says governments must implement reforms
Bank of Japan Governor Masaaki Shirakawa said central banks have been reducing interest rates and buying bonds to help the economy, but there are limits to what monetary policy can do. "Providing liquidity as 'a lender of last resort' is, in essence, a policy to 'buy time,' " Shirakawa said. "It is essential that the necessary structural reforms take place while time is being bought, as the time that we can buy becomes progressively more expensive." Bloomberg(10 Jan.)