EuropeFinancial market regulationCapital markets union

Bankenverband calls for more Europe, less bureaucracy 

22.05.2024Press release
Kerstin Altendorf
  • Bankenverband sets out positions on European policy
  • Focus must be on capital markets union
  • Make financial market regulation fit for the future

“Europe is more important than ever. An open and democratic Europe is vital for our cohesion and our competitiveness in the world,” said Heiner Herkenhoff, CEO of the Association of German Banks, about the upcoming European elections and the next EU legislative period. The challenges of the digital and green transformation are enormous. And to meet them, an economically strong and strategically independent Europe will need efficient banks and capital markets. The private banks have identified five key areas where the new Commission needs to take action:
banking regulation, capital markets, consumer protection, sustainable finance and digitalisation.

“We need innovative ideas and a smart regulation agenda that promotes Europe’s strengths and competitiveness,” said Herkenhoff. And that won’t happen without deeper capital markets. “Capital markets union is finally at the top of the European agenda. The current political dynamic gives us good reason to be optimistic that we will soon see real progress on this.” It is crucial that we don’t just make some adjustments here and there, but that we develop capital market financing in key areas. “You also have to want capital markets in Europe. A first step and a bridging measure should be to revitalise the securitisation market. The EU clearing market should also be strengthened and investment saving should be promoted.”   

For an efficient European banking landscape, Europe needs regulation that is fit for the future. The current EU legal framework is too complex. Regulation has now become an important competitive factor; this has put European banks at a considerable disadvantage. “It is time for the EU to finally stop looking at regulation from the crisis perspective after 15 years,” said Herkenhoff. A consistent, efficient and practicable regulatory approach is needed. Every regulatory initiative and each reform of existing financial market regulation should make financing and investments in the EU more competitive. “Future European financial market regulation must be fit for the future. Imposing more and more additional requirements, is no longer an option”.

For European sovereignty and resilience in the digital area, it will also be vitally important to create innovative ecosystems – such as for the digital euro. Here we need to divide the roles appropriately. Banks offer payment products, the legislator defines the legal framework. “We cannot have a situation where the ECB is unconcerned about acting as both a competitor and supervisor at the same time,” said the association CEO. For a digital euro to be successful, it will ultimately be crucial for the benefits to be recognisable to all stakeholders and for its economic viability to be secured. 

A democratic and competitive Europe that is geared to the future requires, above all, the support of its citizens. Which is why the private banks are explicitly encouraging voting in the European elections. “This election is pivotal: for the future and the opportunities of an open Europe, against populist forces, that want to entrench themselves in the past behind national borders,” said Heiner Herkenhoff. 

Today, in Brussels, the private banks presented their positions on European policy in a paper entitled, “Strengthening Europe and its financial sector: an EU agenda for the coming five years”. You can read their position paper here.

Dr. Kerstin Altendorf
Dr. Kerstin AltendorfDirector, Media Spokeswoman