The European Commission has outlined its plans to make financial markets safer for investors.One of the key points is that two separate watchdogs would be created to supervise Europe’s financial sector. The Commission’s president was asked what was wrong with having just one central supervisory body. Jose Manuel Barroso replied: “It would be unrealistic to think about having just one unique regulatory body for Europe. But even if we were to go for a minimalist option, with one supervisor, given that some countries have the euro currency and others don’t, the truth is we wouldn’t have the slightest chance of finding agreement.” The first body would be hosted by the European Central Bank and would monitor risk across the financial system. The second would be a college of national supervisors covering day-to-day financial operations by banks, insurers and markets. The plan largely follows recommendations made last week by a panel headed by former Bank of France governor Jacques de Larosiere. Other proposed measures include punishing banks whose bonus pay policies encourage excessive risk taking.