- Simplify complex regulation in Europe
- Global level playing field needed
- German banks are well capitalised
Europe’s financial market rules need to be simplified and take better account of developments in global regulation, Christian Sewing, President of the Association of German Banks, said on the occasion of the 2024 Annual Meetings of the International Monetary Fund (IMF) and the World Bank Group (WBG) in Washington, D.C. Internationally comparable competitive conditions were needed.
“Europe must strengthen its competitiveness compared to North America and Asia and must avoid worsening its position through excessive regulation,” said Sewing. Regulation has become increasingly complex, detailed and expensive in recent years. “It is time to look at where rules can be simplified, where redundancies can be removed and where requirements can be relaxed,” Sewing said.
In his recent report on the competitiveness of the European Union, Mario Draghi highlighted the importance of international competition for growth and prosperity. This underlines the urgency of the need to remove regulatory hurdles and to make Europe fit for the future.
The German banks have proven that they are well capitalised and are able to manage risks appropriately. Now is the time to systematically review the existing regulatory framework.
Sewing called for a level playing field in terms of regulation – both in Europe and globally. “Good regulation only works when it is internationally comparable.” This would be particularly important for the implementation of Basel III. Different timetables in the EU, the US and the UK could lead to competitive distortions. The EU has set a deadline for 1 January 2025 but both the US and the UK have proposed their banks comply as of 1 July 2025. And while the UK has already simplified regulations, it is still unclear how and whether the agreements will be implemented in the US. “We must prevent European banks being put at a possible disadvantage in order to maintain the competitiveness of the European economy,” said Sewing.
The Association of German Banks is campaigning in Washington to strengthen the competitiveness of European banks through proportionate regulation and to prevent distortions in international competition. nur einstellen
