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Translated from the French
A new bank resolution mechanism is being developed, designed to prevent bank failures. What can you reply to those who, like the Germans, are afraid that the pooling of risks will make some countries pay more than others?
We have built a new regulatory framework for the financial sector. Within the single market consisting of 28 countries, 18 countries share the interdependence that comes with the euro. And the heads of state of the eurozone decided unanimously – which in itself is a revolution - to create a Banking Union to limit the systemic risks of this interdependence. Banking Union will mean that the same rules will apply to everyone in the single market, but in a more integrated, efficient, and I would even say, more federal way.
Among these rules, there is internal and external supervision, the Basel rules, rules on good governance. They all aim to reduce the risk of bank failure, by means of better funding, more liquidity, more reasonable ratios, a restriction on bank bonuses as well as external and internal supervision. But some risks remain. And what I proposed with the second pillar of the Banking Union is to manage these risks together. I am in contact with the German authorities and the German Finance Minister Wolfgang Schäuble whom I know well and respect, and we have the same kind of discussion that we had about banking supervision. I am confident that an agreement will be reached before the end of the year.
The schedule for these laws is very tight. Can it be maintained even though there will still have to be negotiations in the Council and Parliament?
It is difficult but possible. There is a sense of priority and urgency, both in the Council of Ministers and within the political groups of the Parliament.
And then we also have a regulatory process that evolves in parallel: We are looking, for example, at the problem of shadow banking. It is not our intent to ostracise so-called shadow banks that do indeed play a useful role in financing the economy. But the rules for those institutions have to be comparable in terms of monitoring and supervision, and equally so for money market funds. Further, the issuance of price formation indices such as Libor is also planned.
What is your personal vision of what Europe should do?
Many citizens are concerned about a European project that has no limits or boundaries. We should probably fix those. What else can we do? I would argue for a European industrial policy. It is important that European leaders have found the courage and boldness they showed with the ECSC. I will also argue for a European Defence Community, which obviously will not be what was imagined in 1954. But Europe can also promote subsidiarity.
How would you envisage a debate on Europe?
Why has it been a good thing to create a united Europe, and not a uniform Europe? How, 50 years later, should it evolve? How do we take meet the new challenges of the 21st century? How does it change Europe? What should be done more and what less?
I had the idea that some uncontested figures could jointly produce a report that could then be the subject of public debate in Parliament, among civil society, trade unions, employers, local authorities .. Everyone has something to say about Europe!
Can we take stock of the the achievements of the current Commission before the start of the campaign for the next European elections?
This Commission has rebuilt regulation in the context of the financial crisis and its management, in contrast to what has been done during the previous 25 years. The time for self-regulation and deregulation has come to an end.
There were two major weaknesses: a lack of governance in the euro area and this unique ultra-liberal thinking in the field of financial markets. Over the last four years, we rebuilt economic and fiscal governance with regulations that will make the financial markets serve the real economy again.
Full interview (in French)