EU banks are much more stable today than in the past: they are better capitalised and have sounder business models.
Valdis Dombrovskis, Vice-President responsible for Financial Stability, Financial Services and Capital Markets Union highlighted the changes introduced by the Commission to the banking institutional and legal environment in the past and how banks have adjusted to these changes. He said: “We need to take decisive steps towards financial integration within the EU by completing Banking Union and Capital Markets Union. Only as an integrated market do we have the strength to finance our economies, the depth and liquidity for markets to function efficiently, and the scope for innovative finance to develop and scale up".
The report reviews recent developments in financial markets and the financial sector and their impact on financial stability and integration. Moreover, this year's edition of the European Commission report focuses on two specific issues:
Firstly, it reviews the various elements – both existing and proposed – of Banking Union and discusses the progress made so far in achieving its objective. This is an ongoing project and a comprehensive bank reform package was delivered in November 2016 (IP/16/3731) to further strengthen the Banking Union. However, the measures already in place, such as increased capital requirements and the common frameworks for supervision and resolution, have reinforced financial stability considerably and are important steps to tackle the so-called bank sovereign loop.
Secondly, the report devotes a chapter to macro-prudential policies in the EU and provides valuable insight into how these policies complement other economic policy measures seeking to dampen financial cycles.
Full press release
© European Commission
Key
Hover over the blue highlighted
text to view the acronym meaning
Hover
over these icons for more information
Comments:
No Comments for this Article