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Written by Tom Sims
FRANKFURT (Reuters) – European banks have warned the European Union that their competitiveness and the region’s future are at stake, according to a report published on Tuesday. They are requesting that the sector be designated as a “strategic” sector.
The European Banking Federation’s (EBF) proposals head a list of 45 policy recommendations that the region’s top banking lobbies are releasing ahead of June’s European elections.
In his role as chief executive of Deutsche Bank, the group’s president, Christian Sewing, last year called the bank a “key element of European sovereignty” and called for banks to be recognized as strategic.
However, this is the first time that a European-level bank has formally requested such a status.
“It is essential to recognize the important and strategic role of banks in Europe’s transformation,” Sowing said in the foreword to the 51-page report.
Despite the new push by the financial sector, the European Union has not published a list of sectors it considers strategic.
For the past 20 years, Europe has “outsourced” defense to the United States, energy to Russia and manufacturing to China, EBF CEO Wim Meiss said at a press conference to launch the report. He said this was necessary. Let’s take a closer look at the region’s strategic sectors.
Most of the EBF’s report talked about regulation and the desire to streamline it.
Banking regulations have undergone a major overhaul in the wake of the global financial crisis, which both regulators and bankers claim has made the industry more stable.
But banks now face “overreaching and increasingly overreaching” laws that are becoming “overwhelming”, the report said.
The lobby group called for a review of current regulations to determine how they impact not only stability but also competitiveness and growth.
Bankers have long warned about so-called overregulation, and European officials, including European Central Bank President Lagarde, have argued that regulation must not be weakened.
“We’re not asking for standards to be lowered,” Mizzis said.
“Our regulations are a death knell for good intentions. You’ll see that we overcomplicate things.”
(Reporting by Tom Sims; Editing by Friederike Heine and Jonathan Ortiz)
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