EBF WEEKLY + FINANCIAL REGULATION AGENDA
for the week starting Monday 21 September 2020

An overview of the main banking stories this week and a look ahead to key events in European banking and financial regulation for the upcoming week, brought to you by the European Banking Federation.

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EU Summit to assess Single Market, industrial and digital transition

Brussels will convene an extraordinary EU summit on September 24-25, a day after the European Commission gives updates on its approach towards a Capital Markets Union and a digital finance strategy. EU leaders will devote the talks to the single market, industrial policy and digital transformation. The summit will also be an opportunity to take stock of the situation of the Covid-19 pandemic. In July, the Council agreed on an unprecedented recovery package to counter the effects of Covid-19 on the economies and societies of the EU member states. The two pillars of such a recovery, the green transition and the digital transformation, coupled with a strong single market, fostered new forms of growth and strengthen the EU's resilience. Leaders will look at ways of deepening and strengthening the single market, developing a more ambitious industrial policy, and pressing ahead with the digital transformation. Agenda

The financial agenda for the next week

Thursday 24 September:

• Special European Council, two-day event, agenda

• ECB: General Council meeting, Frankfurt

• Salzburg Global Finance Forum. EBF's CEO Wim Mijs speaking, virtual event

• The Banking Scene: Society & Banking in 2030, with EBF CEO Wim Mijs speaking

• European Internet Forum virtual conference: Rebuilding Europe through digital transformation

• International Bar Association virtual conference: Virtual New Era of Taxation

• EBF Reporting and Statistics working group virtual meeting

Friday 25 September:

• European Commission webinar: NPL Roundtable 2020

• Concurrences webinar: Global Antitrust Hot Topics #2 Platforms: Towards a Regulated Industry?

• CEPS webinar: The euro: no legitimacy without solidarity?

• UK in a changing Europe webinar: Brexit – what next?

• EBF Digital Strategy Group virtual meeting
   

For more events check the EBF planning calendar HERE
 

*All events take place in Brussels unless stated otherwise

FROM THE MEDIA this week

The Banker: European banks grapple with digital transformation

Covid-19 has accelerated retail and business banking customers’ adoption of digital financial services, driving banks to speed up their transformation programmes across their geographical footprint in Europe, writes The Banker magazine. Read more

Euractiv: EU to create ‘superbody’ of watchdogs to oversee crypto

The EU will set up a new college of supervisors, including national and European authorities, to oversee “significant” digital currencies including Facebook’s Libra, according to the European Commission’s cryptocurrency draft proposal seen by Euractiv. The long-awaited regulation will address the high volatility of cryptocurrencies including Bitcoin, the most popular of these digital tokens, and the risks posed by systemic ones, like Libra. With the 167-page draft text, expected to be presented in the coming weeks, the EU will become the first major jurisdiction to regulate cryptocurrencies. Read more

Financial News: Don’t dismiss a UBS-Credit Suisse merger too quickly

Although the hurdles remain formidable, the world has changed in a number of ways over the last year that make European bank deals, including this one, more possible, writes David Wighton in Financial News. Read more

EFC: European banks contemplate massive job cuts

As banks with existing layoff plans put them back into action, new banks are starting to eye the possibility of making substantial cuts of their own, writes eFinancialCareers. The Europeans are at the front of the queue. Deutsche Bank and HSBC are already cutting around 20% and 15% of their staff in total. Now the Swiss banks and Commerzbank are contemplating doing the same. Read more Bloomberg

EFE: Spain and Italy open the way for bank mergers in Europe

The announced merger between the Spanish Caixabank and Bankia and the purchase of UBI Banca by Intesa Sanpaolo in Italy could take off the bank consolidation process demanded by the European Central Bank at a time when the pandemic threatens to create problems for some entities, the Spanish news agency EFE reports. The European Banking Federation considers "important" this "explicit recognition" that, "within what the regulation allows them, they will see these processes favorably" and believes that it will be of "help" since it clears doubts about the position that the supervisor will maintain, according to the Federation's supervision director, Gonzalo Gasós, explained to EFE. Read more

Fitch: Climate Stress Tests Will Eventually Influence Bank Capital

Climate-change stress tests will eventually feed into prudential capital requirements for European banks, Fitch Ratings says in a new report. EU and UK supervisors appear the most advanced in efforts to quantify the assessment of climate risks to banks, although Japan has recently unveiled climate-risk stress tests for its largest banks, according to media reports. The ECB is the only regulator to make clear that climate scenario analysis and stress testing should explicitly feed into banks' capital adequacy. We believe this is to help drive the European Green Deal, which aims targets climate neutrality for the EU by 2050. The US, meanwhile, shows no sign of introducing climate-risk stress tests for its banks. Read more

Salzburg Global Finance Forum 

FINANCIAL REGULATION IN TIMES OF PANDEMIC:
WHAT DO WE NEED TO ACHIEVE?

Harnessing the Salzburg Global Finance Forum’s cross-border networks and thought leadership, this webinar will examine the critical role of the financial sector for post-pandemic economic recovery and discuss how a high-quality regulatory framework could help “build back better” for a more resilient, equitable and sustainable financial system. Among the speakers: Edouard Fernandez-Bollo, ECB Supervisory Board member, and EBF CEO Wim Mijs. For more information and registration click HERE

FROM THE MEMBERS this week

SB: Open Banking as a business model - implications for banks

Banks today need to look more closely at open banking as part of the digital transformation and in particular as a platform strategy. If you get into this business, IT becomes a core topic. In order to be successful in this environment, the organisation has to orientate itself technically, methodically, but also culturally to the role models from the Internet industry. Find out more in the Swiss Banking (SB) guest blog post by Dr. Stephan Murer. Read more (DE)

Finance Finland: Online banking surges in the coronavirus pandemic

HUB: Banks in Croatia maintain lending activity despite the pandemic

According to the Croatian Banking Association (HUB) Review 3/2020, after the beginning of the crisis in March 2020, banks maintained lending activity at approximately pre-crisis level, and in some market segments, such as housing loans to households, credit growth accelerated. Read more (HR)

SBA: Do not limit banks to support recovery

Do not limit the banks to support recovery. Banks and the Swedish Bankers' Association (SBA) have played an active role in supporting the Swedish economy during the corona crisis. Now it's time to think ahead, says SBA CEO Hans Lindberg. Read more (SE)
 

NVB: AML: De-risking and its impact on access to financial services

Money laundering investigations sometimes pose obstacles to companies’ access to financial services - Have a look at the  Dutch Banking Association (NVB) response to the call for input by EBA on ‘de-risking’ and its impact on access to financial services. Read more

EBF High-Level Public Dialogue

EUROPEAN BANKING BEYOND THE PANDEMIC

As the pandemic hit the economy, businesses and households across the EU benefited from a resilient European banking ecosystem. A ‘new normal’ in European banking is taking shape, this time with banks as part of the solution. Yet, the industry is encumbered with many of the pre-existing challenges: low returns, high cost of capital, negative interest rates, the prospect of even tighter capital requirements and a fragmented EU financial services market keep Europe’s banking sector from being an attractive place for global investors and from competing globally with big-tech challengers.

The EBF High-Level Public Dialogue seeks to outline how European banking will look like beyond the pandemic by bringing together leading industry representatives with top supervisors and regulators. For more information and registration click HERE

FROM THE INSTITUTIONS this week

ECB: Exceptional circumstances justify leverage ratio relief

The Governing Council of the European Central Bank (ECB) has decided that it concurs with ECB Banking supervision that there are ‘exceptional circumstances’ allowing the temporary exclusion of certain central bank exposures from the leverage ratio. Read more

EBA seeks input from institutions on their ESG disclosure practices

The European Banking Authority (EBA) published an online survey to receive input from credit institutions on their practices and views in the area of disclosure of information on environmental social governance (ESG) risks. . Read more

SOTEU: President von der Leyen at the European Parliament Plenary

Commission President Ursula Von Der Leyen has delivered her first State of the Union speech. Her address touched upon issues such as NextGenerationEU; the EU's response to the Covid-19 pandemic; building a stronger Health Union; a framework for minimum wages; a new strategy for the future of Schengen; the European Green Deal; the strategy for digital; the situation in Belarus; global engagement; migration; Rule of Law; anti-racism and tackling hate crime and discrimination. Read more
 

ECB's Panetta speech: Healing after the pandemic

Europe has successfully responded to a major challenge but is not out of the woods yet, says Executive Board member Fabio Panetta at The Economist’s Roundtable with the Government of Greece. We must be vigilant and carefully assess incoming information including exchange rate developments. Read more

Eurogroup: Main results of the Eurogroup meeting

The Eurogroup meeting was hosted by the German presidency of the Council in Berlin. It was the first in-person meeting of the Eurogroup since February 2020, when Covid-19 restrictions were introduced. This was also the first meeting chaired by the Eurogroup President Paschal Donohoe, who took up the function on 13 July 2020. Read more

ECOFIN: Remarks by Executive Vice-President Dombrovskis

In a speech delivered to the ECOFIN press conference in Berlin on September 12, European Commission Executive Vice President Valdis Dombrovskis commented on crypto-assets and stablecoins. Dombrovskis stated: “We want the EU financial sector to make the most of the opportunities offered by digitalisation, with innovative European market players leading globally. European consumers and businesses should benefit from digital finance too, while ensuring that risks are properly mitigated.” Read more

FROM THE EBF this week

EDPB’s consultation on the interplay of PSD2 & GDPR: EBF response

The European Banking Federation (EBF) has submitted its response to the European Data Protection Board’s (EDPB) consultation on the draft guidelines on the interplay of the Second Payment Services Directive (PSD2) and the General Data Protection Regulation (GDPR). Read more

Sustainability & Going Green: How will Banks adapt to this new world? 

On Tuesday 15 September, the European Banking Federation and S&P Global ran a webinar "Sustainability & Going Green: How will Banks adapt to this new world?". Have you missed it? No worries! Click HERE to watch the full webinar & presentations from our experts.
 

Recovery package: EBF response to EC consultation on research

The European Banking Federation has responded to the European Commission consultation on Research amending delegated directive (EU) 2017/593. Read more

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, with active members in 32 countries. The EBF 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.

European Banking Federation