The European Commissioner for Banking Services, Maria Luís Albuquerque, rejected the requests from major banks to split into two the major reform she is planning to strengthen the competitiveness of the financial sector in the European Union. In an interview with Bloomberg TV, the Portuguese commissioner stated that Europe is better served with a single package to flexibilize regulation and eliminate barriers at cross-border levels.
In the previous week, leaders of 11 major banks from the EU, Switzerland and the UK had sent a letter to senior European officials asking that priority be given to short-term simplification and more time to discuss more problematic issues, such as the European deposit insurance system. The banks recalled that they already have 2.5 trillion euros in shock absorption capacity and called for an immediate and temporary moratorium on new capital increases until long-term reforms are in place.
Maria Luís Albuquerque defended that the fragmented approach is not enough. "If we really want to do something meaningful, we need to analyze this as a whole, because everything is interconnected," she said. The commissioner stressed that the problems mainly stem from fragmentation and from the debate over which will be the host country, and not from the current capital rules.
The commissioner emphasized that the reform is not for the benefit of banks, but for the benefit of the EU economy. "We need to address the problems where we find them, and they do not mainly stem from the current capital rules. Even though we are also analyzing and simplifying them," she added.
