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Why have one new institution when you can have three? Or indeed four. The De Larosiere report has backed off creating a single brand new watchdog to oversee financial institutions in the European Union.

The grand old man of European finance said that "we might have been accused of being unrealistic". He said his aim was not to pile rule upon rule, but to come up with a new system that was "ambitious but not unrealistic." Given the gloom I wrote about earlier it is quite appropriate that his system resembles , the guardian of the gates of Hades, a three-headed watchdog.

There would be separate new authorities to look after insurance, banking and securities. He also said it was clear that, although there were warnings before the crisis, the alarm bells were not ringing loud enough. So he also proposes another new body, called the "European Systemic Council", made up of the governors of the various national banks. He stressed the governor of the Bank of England would play a very important role.

The European Commission President, Jose Manuel Barroso, said they would make their official response a week today, but gave the report a very warm welcome, saying: "We are determined not to miss the chance to restore confidence in European and global financial systems. The citizens of Europe expect us to change the rules of the game."

Not everyone agrees: listen to the reaction on Radio 4's World at One. The chap at the end of the item may not be reassured that the president of the Socialists in the European Parliament has welcomed the report. PES president Poul Nyrup Rasmussen said: "The De Larosiere group's proposals represent an essential step forward. They are ambitious but practical. The spotlight is now on the European Commission. It is a test of Barroso's courage and conviction. Today should be an important day in the history of international financial markets - but we shall see if the current conservative European Commission is capable of taking the recommended steps." What do you think?

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