On banking Union – annual report 2024
ECON-PR-765133
Committee on Economic and Monetary Affairs · Rapporteur: Ralf Seekatz
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This draft report on Banking Union – annual report 2024 asks the Commission to keep completing the Banking Union a priority, notes challenges to EU banks' competitiveness, and makes recommendations on supervision, resolution and deposit insurance.¶¶¶
Committee position. The rapporteur proposes a resolution that asks the Commission to prioritise completing the Banking Union, makes recommendations on supervision, resolution and deposit insurance, and calls for specific actions such as assisting banks exiting Russia and ratifying the ESM treaty amendment.¶¶¶
Key points
- Asks the Commission to ensure that completing the Banking Union remains a key priority, highlighting benefits for households, SMEs, financial stability and the green and digital transition.¶
- Notes that a more integrated Banking Union would increase resilience and private risk sharing; calls on supervisors to assist EU banks still operating in Russia to exit that market.¶¶
- Welcomes the adoption of the banking package implementing Basel III, asks the Commission to evaluate whether delaying implementation is needed, and welcomes the one-year postponement of the market risk framework to 1 January 2026.¶
- Notes high capital levels (CET1 ratio 15.81%), stable non-performing loans ratio (2.30%) and liquidity coverage ratio (159.39%), and the lack of progress on the credit servicers directive.¶¶¶
- Welcomes the creation of the Anti-Money Laundering Authority and stresses the need to enhance resilience of non-bank financial intermediaries.¶¶
- Welcomes the crisis management and deposit insurance proposal's objectives, stresses that shareholders and creditors must bear losses first, and warns against reductions in the minimum requirement for own funds and eligible liabilities.¶¶¶
- Highlights that liquidity support in resolution should not rely on public funds, welcomes the SRB's 'SRM Vision 2028' and streamlined resolution planning, and calls for full ratification of the ESM Treaty amendment for a common backstop.¶¶¶
- Calls for more standardisation and harmonisation of resolvability assessments, and notes that national deposit guarantee schemes have worked well, urging preservation of smaller banks' systems and institutional protection schemes.¶¶¶
- Recalls that breaking the link between bank and sovereign risk remains a challenge and that risk can be reduced through regulatory treatment of sovereign exposures.¶
Who is affected
- EU banks operating in Russia: supervisors should assist them in exiting the Russian market.¶
- EU banks: face competitiveness challenges from higher costs and lower profitability; may benefit from a separate jurisdiction for cross-border banks.¶¶
- Small banks: noted not to pose risks to financial stability; their deposit guarantee systems should be preserved.¶¶
- Member States: may implement targeted increases in macroprudential buffers; must ratify the ESM Treaty amendment.¶¶