11 November 2009

EBF’s report on overcoming the crisis, moving beyond and the new challenges ahead

EBF's Report identified two new challenges as a direct result of the crisis. The first new key challenge is to restore confidence in the banking sector, and the second is to establish meaningful transparency in financial markets.

The Report concludes that:

·         The European banking sector is going through difficult times. The pace of integration has been set back by the collapse of major banking groups, the constraints on access to capital in the financial markets and the general deterioration in economic conditions domestically and globally.

·         Financial institutions find themselves in a situation where they must operate in sub-optimal market conditions and continue business-as-usual as far as possible, in order to minimise the second-round effects both for themselves and the real economy.

·         A major role in securing the situation in Europe is being played by the European Central Bank and the national governments. However, their support should remain time-limited. As soon as the market starts to stabilise, the support will be withdrawn in order to protect public finances and the market economy, as well as to maintain a level playing field across the financial institutions in Europe.

 

·         The European Commission is playing an active role in reacting to these turbulent times by identifying and bridging the gaps in the existing body of regulation, thus forming a sound foundation for financial market and banking activity in the future. A number of key issues are now being addressed both at EU and the wider international level: the transparency of financial services and products offered, harmonisation of accounting and reporting standards, elimination of fiscal barriers, stronger and more fruitful international cooperation, adoption of a common euro payments system, and the integration of retail financial markets.

·         Given the reinforced legal ground and the generous (even if temporary) support from the European and national institutions extended to the financial sector in these difficult times, it is likely that, once the economies are back on track, the process of financial market integration will become clearer and more straightforward than before.

 

·         The EBF’s guiding principles impel it to play a role in furthering the single market, promoting better regulation and regulatory convergence, and supporting free and fair competition. It therefore stands ready to advocate and do its best to progress the pan-European integration of financial markets, thus making Europe a better place to live and work, for all its citizens.

Press release

Full report

© EBF