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PARIS, June 27 (Reuters) - The plush backdrop of the Westin Vendome hotel in Paris had champagne on ice on the bar throughout this week's Institute of International Finance (IIF) conference but no bankers were spotted popping the corks.
Five years after the financial crisis and more than three years after Greece heralded a new threat to Europe's long-term prospects, the woes of the euro zone continue to weigh heavily on banking sector leaders.
News late on Wednesday that EU politicians agreed a plan to force bondholders to take losses at failing banks came too late to lift the gloom. It also robbed the event of its main speaker, with French Finance Minister Pierre Moscovici whisked away to Brussels to discuss the deal.
"The mood is no different this year to last year. That's noticeably different to the U.S.," said one American attendee at the event. "Over here you don't get that sense (of improvement) at all."
The closing dinner for more than 400 people was staged at La Salle Wagram - an impressive theater in Paris' 17th arrondissement less than 100 meters from the Arc de Triomphe with a lengthy red carpet for delegates to walk down.
But the lavish touches of opera and cannon fire that marked last year's event in Hamlet's castle near Copenhagen, or an even grander banquet in Beijing four years ago, were missing - some reflection, perhaps, that organisers were seeking to be more in tune with the recessionary times.
With excess out, the focus for the group's more than 450 members from the financial industry was on what it dubs the three Rs - regulation, reputation, and risk - and the chance to rub shoulders with politicians, regulators and investors.
Jean Claude Trichet, gradually returning to public life 18 months after ending a tough stint as European Central Bank President, made two speeches (his own, and one to fill in for the missing Moscovici) and could be heard telling jokes on the sidelines among groups of delegates.
Bank bosses called for more clarity on what the regulatory landscape will look in five years, saying many complex issues that will affect their shape and size are still unresolved.
The European public still believes banks have more to do to make up for the chaos and economic pain caused by the 2008 crisis, but the sector's leaders warn overregulating may just stall recovery further.
"The number one issue for most of is what are the regulatory rules of the game," said Rick Waugh, CEO of Canada's Scotiabank .
Bosses who met behind the scenes were at least optimistic things had improved, Waugh said. "Last year we were talking about whether the euro would survive. There are still issues in Europe, but we're not talking about survival."
Concerns at how central banks will unwind their quantitative easing and worries of a slowdown in China cast a pall, but they did little to knock the conviction that a three speed economy is underway: Europe is in the slow lane, the United States has revved up its engine and making progress, while Asia has hit some bumps but is still cruising.
When ECB member Jorg Asmussen said the central bank had no need to put its foot on the brake nor press the accelerator, UBS Chairman and former Bundesbank chief Axel Weber said the problem was Europe was not driving a car, but had a big bus with 17 passengers.
"What you really pick up is the realisation that America is recovering and its financial sector at the top is in relatively good shape," said Gerard Lyons, a former economist at Standard Chartered and now advisor to London's mayor.
"Slowly the penny is dropping here that Europe needs to get a move on."
Public relations firm Edelman laid out for bankers the redemption task they face. Financial services have ranked bottom in terms of trust across business sectors in its surveys of consumers in each of the last two years, with banks' performance and perceived behaviour both faring poorly.
The IIF said it is committed to being lean to reflect the times its members lived in, and is keen for more non-financial members, such as newcomer Spanish power firm Iberdrola.
Yet it remains firmly a bankers' forum - with occasional diversions into insurance and asset management - and most of the focus on harmonising or simplifying regulation is preaching to the converted, one delegate said.
"If someone here said big banks should be broken up then they may as well go and stand in the corner," she said.