29 May 2014

EBF: European banks support reform process and recognise need for change

The EBF strongly disagrees with the view expressed by Mrs Christine Lagarde that banks are pushing back on reform. On the contrary, European banks fully recognise the need for change and continue to participate in reform processes because these are critical to the success of Europe’s economy.

In recent years, banks have played an active role in the numerous regulatory reforms that have been introduced at the international as well as the European level. As a result, banks hold significantly more safe capital and there no longer is a need to call on taxpayers if a bank fails. The stress tests should make the banking sector even more robust.

Banks continue to support the introduction of tighter and better supervision and have embraced reforms such as Basel III, the EU’s Bank Recovery and Resolution Directive and Banking Union. Asking for adjustments, such as for a fine‐tuning of liquidity and leverage ratios, does not mean that banks obstruct their introduction. Even the Basel Committee has recognised the need to calibrate ratios.

When it comes to fraudulent activities such as attempts to manipulate benchmarks, the EBF continues strongly to condemn misbehaviour by certain bankers. The International Organization of Securities Commissions (IOSCO) has recognised that the governance of critical benchmarks (Libor, Euribor and Tibor) has been enhanced and made more robust, while new regulatory standards are being implemented. EBF is convinced that similar changes in governance and behaviour will occur with other benchmarks, such as for gold and forex markets.

As far as European banks are concerned, efforts to enhance the ethical behaviour in banking sector are a priority and will continue.

Full letter

"Bank reforms slowed by fierce industry pushback – Lagarde", 27.5.2014  © A BusinessDay Media Ltd. 

© EBF