📰 EBF Morning Brief - Monday 14 June: ECB’s Knot says European debt rules need to become more flexible

FROM THE MEDIA

Bloomberg: ECB’s Knot says European debt rules need to become more flexible

European Union rules meant to rein in excessive borrowing by its member states need to become more flexible in order to allow for more public investment outside of extreme circumstances, said Klaas Knot, the president of the Dutch central bank. “Flexibility should somehow be a more intrinsic feature of the system, and not one that arises only in emergencies,” he said in a speech on Friday. As the current low-interest rate environment is likely to persist, a structurally larger role for fiscal policy in macroeconomic stabilization for the foreseeable future is needed, Bloomberg reports. Read more

FT: Deutsche Bank pressed by ECB to name successor to Achleitner

Achleitner will leave Deutsche Bank next year after a difficult 10-year stint in which Deutsche reported €12bn in cumulative losses, raised €19.5bn in new capital and announced five strategic reorganizations. The European Central Bank (ECB) has repeatedly urged Germany’s largest lender to come forward with a clear succession plan in recent months, people briefed on the matter told the Financial Times. Read more (€)

Reuters: As EU preps debut recovery bond, a reality check for "safe asset" hopes

As the European Union readies bond sales for its pioneering COVID-19 recovery fund, the scale and duration of the borrowing program may disappoint those who had visualized last year’s deal for pooled debt as Europe’s Hamiltonian moment, reports Reuters. Without a fiscal union, according to Chris Iggo, chief investment officer for core investments at AXA Investment Managers, the issuance is destined to be “a historical anomaly and the bonds will just get tucked away in insurance company portfolios”. Read more

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EBF Digital Thursdays

Close-up: A Digital Euro

ONLINE / Thursday, 24 June at 13:30 CEST

In Europe, the European Central Bank (ECB) is expected to announce soon the continuation of its investigation into a digital euro following a public consultation phase. Fabio Panetta, Member of the Executive Board at the ECB will join our CEO Wim Mijs in a fireside chat on June 24 for the ‘Close-up: A Digital Euro’ online event. Together, they will discuss the potential implications of the Digital Euro for the Eurozone, the latest considerations by banks and governance on the way forward. Register HERE

FROM THE EBF MEMBERS

NVB: Strict approach to Basel 4 implementation limits capacity for economic recovery

The strict application of the Basel 4 capital requirements, as proposed by the Dutch Ministry of Finance and Dutch Central Bank (DNB) earlier this week, would limit the capacity for economic recovery. Now that we are at the start of the economic recovery and entering a period that will require significant investments, this policy position is not very helpful. Furthermore, it hampers the necessary financing of the sustainable and digital transformation to which banks would like to contribute. From this perspective, a more proportionate implementation of Basel 4 would be desirable, the Dutch Banking Association (NVB) says. Read more

UK Finance: Managing the post Covid-19 recovery and supporting growth – the opportunity ahead

As businesses continue to recover and build for the future there could be significant future demand for funding in 2021. There will be sufficient supply of finance available for viable businesses and the industry is well placed to play a key role in the recovery. 'I expect challenger and non-bank lenders to play an important role in the provision of finance alongside the high street brands. Helping SMEs to navigate the SME financing landscape will be key', Mike Conroy, Director of Commercial Finance at UK Finance writes. Read more

Finance Denmark: Consultation response: European Commission proposal for digital identity

Finance Denmark has submitted a consultation response to the EU Commission's proposal for a digital identity for all Europeans. Finance Denmark supports the EU Commission's proposal for a common digital identity but stresses the essential precondition that the investment in the development of a European eID solution is in a reasonable proportion to the expected spread. Read more (DK)

FROM THE INSTITUTIONS

ECB: Consolidation in the European banking sector: challenges and opportunities

Edouard Fernandez-Bollo, Member of the Supervisory Board of the European Central Bank (ECB) discussed the consolidation of the European banking sector as well as its challenges, opportunities and implications for the stability of the financial system. 'Banks play a key role; they are the largest providers of credit to the euro area economy, so their profits are a key source of the new capital that is needed to support economic growth. Moreover, banks with a strong capital base can absorb the most immediate losses in an economic downturn, without compromising their ability to keep lending to the real economy. This robust credit supply then facilitates the recovery', he says. Read more

ESAs publish amended technical standards on the mapping of ECAIS

The Joint Committee of the three European Supervisory Authorities (EBA, EIOPA, and ESMA - ESAs) published two amended Implementing Technical Standards (ITS) on the mapping of credit assessments of External Credit Assessment Institutions (ECAIs). The amendments reflect the recognition of two new credit rating agencies (CRAs), the outcome of a monitoring exercise on the adequacy of existing mappings, and the deregistration of a number of CRAs. Read more

EBA: Report on the data provided by PSPs on their readiness to apply strong customer authentication for e-commerce card-based payment transactions

The European Banking Authority (EBA) published a Report on the data provided by PSPs on their readiness to apply SCA for the subset of payment transactions that are e-commerce card-based payment transactions. The Report highlights the status of issuing and acquiring PSPs in enrolling online merchants, payment cards and payment service users (PSUs) into SCA-compliant solutions, and in requesting SCA for online payment transactions after 31 December 2020, when the SCA migration period ended. Read more

European Commission weekly schedule

Find out more about the European Commission's engagement and activities for the upcoming week. Read more

European Central Bank weekly schedule

Find out more about the ECB's engagements and activities for the upcoming week. Read more

European Parliament weekly schedule

Find out more about the Parliament's engagements and activities for the upcoming week. Read more

FROM THE EUROPEAN BANKING FEDERATION

EBF adopted the Women’s Empowerment Principles

EBF adopted the Women’s Empowerment Principles (WEPs) to generate opportunities for women in all the ways in which they interact with our banks. European banks are actively working on gender equality. As one of the first federations ever to adopt the WEPs, we are setting a model for the sector to coordinate these efforts and speed up progress on gender equality. Check out our women's empowerment webpage now available HERE

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