EBF MORNING BRIEF Wednesday 2 June 2021 Good morning. Here are the top news stories and events in European banking, financial regulation and EU policy, brought to you by the European Banking Federation.
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FROM THE MEDIA
FT: Eurozone inflation tops ECB target for first time since 2018
Eurozone inflation rose to 2 per cent in May, the first time the rate has surpassed the European Central Bank’s target in more than two years, complicating policymakers’ decision next week on whether to maintain its ultra-loose monetary policy. Several European Central Bank (ECB) policymakers, including its president Christine Lagarde, have said the recent surge in inflation is only a temporary phenomenon, driven by one-off effects, and predict it will fade next year. This means the central bank’s policy should remain highly accommodative, the Financial Times says. Read more (€) BBC
Bloomberg: HSBC, Barclays, Credit Suisse: How climate focused are European banks?
Many banks are publishing relevant data this year on criteria such as lending to fossil fuel industries, as Europe’s central banks scrutinize their loan books and threaten higher capital requirements for those with excessive climate risks. Bloomberg analyzed annual reports and similar filings from a selection of Europe’s major banks. While they’re giving hard numbers on the money loaned to companies that will be challenged as the world tries to reduce CO2 output and avoid climate disaster, the disclosures provide a limited view into only a portion of their business. Read more
The Banker: The drive to improve cross-border payments
The setting of hard targets to bring international payments into this century should be applauded – but is the FSB’s deadline too ambitious? The FSB’s proposed deadline is the end of 2027 for all challenges and segments, except the cost target for both wholesale cross-border payments, which is more complex and harder to estimate average costs, and remittances, where a 2030 date has already been set as a UN Sustainable Development Goal. That gives banks and other service providers just six years to align with the proposals, which include among others: reducing the global average cost of a retail payment to less than 1%, with no corridors with costs higher than 3%; at least 75% of cross-border payments in each segment should be made within an hour; and all payment service providers must provide a defined list of information, such as total transaction cost and funds tracking, The Banker reports. Read more |
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MAIN EVENTS BIS: Bank for International Settlements, Banque de France, International Monetary Fund and Network for Greening the Financial System 'Green Swan 2021 Global Virtual Conference' For a full-year overview of key financial regulation events: click here |
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FROM THE EBF MEMBERS
BPFI: Strong growth in mortgage approvals continues in April driven by FTBs
A total of 4,362 mortgages valued at €1,089 million were approved in April 2021; the highest value for April since the Banking & Payments Federation Ireland (BPFI) started collecting this data in 2011. The latest figures from the BPFI Mortgage Approvals Report for April 2021 show that first-time buyers (FTBs) were approved for 2,389 mortgages (54.8% of total volume) while mover purchasers accounted for 1,013 (23.2%). Read more
Febelfin: New Ombudsman at the Office for Financial Services
The new Ombudsman for the financial sector, Jean Cattaruzza, will take office on 1 July 2021. He will focus on continuing the good functioning of Ombudsfin in close contact with consumer organizations, financial institutions, regulators and supervisory authorities, Febelfin reports. Until July, Elke Heymans, current secretary-general and advisor at Ombudsfin, is Ombudsman ad interim. Read more (FR)
Finance Norway: Consumer debt increases after reopening
Consumer loans have increased slightly since Norway re-opened up last week. The increase is especially for non-interest-bearing credit. This means that people have started using their credit cards, but used credit has not yet fallen due for payment. "Although many have saved money through the pandemic, we expect an increase in unsecured debt", says Gry Nergård, Consumer Policy Director at Finance Norway. Read more (NO) |
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FROM THE INSTITUTIONS
ECB: SMEs remain concerned about financing
The European Central Bank's (ECB) latest survey shows that Small Medium-sized Enterprises (SMEs) continue to report declines in turnover and profits, although the business activity is expected to improve in the coming months. The availability of bank loans improved marginally, but not for the smallest firms. Read more
European Commission: New European Tax Observatory to support fight against tax abuse through cutting-edge research The European Commission has announced the launch of the European Tax Observatory. It is a new research laboratory to assist in the EU's fight against tax abuse. The Tax Observatory will support EU policy-making through cutting-edge research, analysis and data-sharing interconnected investment firms as defined in the Investment Firm Regulation (IFR). The list is intended to provide guidance ahead of the application of the IFR requirements, as of 26 June 2021. Read more ESRB: Resolving mortgage distress after COVID-19: Lessons from the last crisis The European Systemic Risk Board (ESRB) analyses microdata on Irish mortgages and distressed households’ balance sheets in the last decade to assess the debt resolution process in the Irish mortgage market in the lead up to the COVID-19 shock. Findings highlight the widespread engagement of Irish borrowers with debt resolution mechanisms during a decade in which one-sixth of mortgage accounts were restructured by 2016. The paper also provides a list of lessons for the COVID-19 era, including a need for firms to have the capacity to assess longer-term prospects and move to sustainable and longer-term arrangements where they are appropriate to the depth of financial distress being experienced. Read more |
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FROM THE EUROPEAN BANKING FEDERATION
EBF calls for next steps to strengthen economic recovery in Europe: EBF Board Communiqué
The Board of the European Banking Federation (EBF) reiterated that European banks stand ready to continue supporting businesses and households amid growing uncertainty over the pace of the economic recovery. The EBF board also highlighted the need to evolve the policy response to ensure a ‘soft landing’ to the new normal and expressed confidence in governments’ commitment to avoiding a ‘cliff-edge’ effect. Read more |
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ABOUT THE EUROPEAN BANKING FEDERATION
The European Banking Federation is the voice of the European banking sector, bringing together national banking associations from across Europe. The federation is committed to a thriving European economy that is underpinned by a stable, secure and inclusive financial ecosystem, and to a flourishing society where financing is available to fund the dreams of citizens, businesses and innovators everywhere. Website: www.ebf.eu |
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