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Priorities for the banking sector (prudential requirements, global competitiveness…)

Priorities for the banking sector (prudential requirements, global competitiveness…)

Day 2 Morning

Thursday 12 September

Room :

ROOM 2

Speakers

Chair
José Manuel Campa
Chairperson - European Banking Authority (EBA)
Public Authorities
David Bailey
Executive Director for Prudential Policy - Bank of England
Ugo Bassi
Director - Banking, insurance and financial crime - DG for Financial Stability, Financial Services and Capital Markets Union, European Commission
Eva Wimmer
Director General - Federal Ministry of Finance, Germany
Industry Representatives
Alban Aucoin
Head of Public Affairs - Crédit Agricole S.A.
Christian Castro
Head of Public Affairs - CaixaBank
Hideo Kawafune
Chief Executive Officer, SMBC Bank International plc and Managing Executive Officer & Head of EMEA Division, SMBC Group & Chair, Supervisory Board, SMBC Bank EU AG - SMBC Bank EU AG
Fernando Vicario
Chief Executive Officer, Bank of America Europe DAC & Country Head, Ireland - Bank of America Europe DAC

Objectives

European banks are concerned that the implementation of Basel 3 will lead to an increase in RWAs without the accompanying reduction in Pillar 2 requirements and without benefiting from reduced regulatory and management buffers, as envisaged in the UK.

Against this backdrop, this session will examine the impact of capital requirements of banks in different regions of the world, study why the Basel regime is transposed differently around the world and the resulting consequences and examine how European banks can benefit from the expected added value of international standards while preserving their competitiveness and ability to finance the European economy.

Points of discussion

  • Competitiveness of the European Banking Sector

Why is the global market share of European banks declining sharply?

Why is it that the profitability of European banks, which has recently improved, remains lower in relative terms than that of their international competitors? What are the implications for the financial stability and strategic autonomy of Europe, given the increasing dependence on non-European financial institutions?

  • Basel Endgame Impacts for Banks

The latest BCBS monitoring report (March 2024) highlights the varied impacts of the Basel 3 framework on banks in different jurisdictions globally: What is the impact of Basel 3 on Japanese, EU and UK banks? Given differences in implementation strategies, can EU banks further lose in competitiveness?

Where does EBA stand on its 130 level 2 ad 3 mandates? Are there any concerns about gold plating (e.g. the ITS on pillar 3, which requires banks to publish their RWAs without considering the transitional provisions, which extend to 2032)?

  • Challenges Related to the Lack of Global Consistency

What are the prospects for implementing the Fundamental Review of the Trading Book (FRTB) in different regions worldwide?  What are the issues and challenges posed by the divergent implementation in the different jurisdictions of banks trading book regulations (What explains the reluctance to adopt the new legislation, particularly in the US?