Activities of Frances FITZGERALD related to 2021/2184(INI)
Shadow reports (1)
REPORT on Banking Union – annual report 2021
Amendments (40)
Amendment 3 #
Motion for a resolution
Citation 9 a (new)
Citation 9 a (new)
Amendment 4 #
Motion for a resolution
Citation 9 b (new)
Citation 9 b (new)
— having regard to the Commission's consultation on improving the EU’s macroprudential framework for the banking sector of 30 November 20211a; _________________ 1a https://ec.europa.eu/info/consultations/fin ance-2021-banking-macroprudential- framework_en
Amendment 5 #
Motion for a resolution
Citation 9 c (new)
Citation 9 c (new)
— having regard to the Commission's legislative package on Anti-money laundering and countering the financing of terrorism of 20 July 20211a; _________________ 1a https://ec.europa.eu/info/publications/210 720-anti-money-laundering-countering- financing-terrorism_en
Amendment 6 #
Motion for a resolution
Citation 10 a (new)
Citation 10 a (new)
— having regard to the ECB's report on its supervisory priorities for 2022-24 on 7 December 20211a; _________________ 1a https://www.bankingsupervision.europa.e u/banking/priorities/html/ssm.supervisory _priorities2022~0f890c6b70.en.html
Amendment 25 #
Motion for a resolution
Recital A
Recital A
A. whereas the bBanking uUnion (BU) currently consists of, comprising the Single Supervisory Mechanism (SSM) and the Single Resolution Mechanism (SRM), with the single rulebook as its foundation, ensures full alignment between supervision and management of banking crisis and is an integral part of the Union's financial stability;
Amendment 40 #
Motion for a resolution
Recital B
Recital B
B. whereas the BU is open to all EU Member States; whereas Bulgaria and Croatia have joined ERM II and entered the Banking Union;
Amendment 42 #
Motion for a resolution
Recital B a (new)
Recital B a (new)
B a. whereas the EU banking sector has responded to the COVID-19 pandemic with resilience, with the help of extraordinary public policy relief measures and a resilient EU regulatory framework, and without having endured a corresponding financial crisis; whereas, as the EU banking sector emerges from the pandemic, the Union must continue to uphold high standards, particularly when it comes to capital requirements and risk management practices, to ensure the resilience of the sector in the future;
Amendment 50 #
Motion for a resolution
Recital C
Recital C
C. whereas the problems ofbanking sector faces emerging risks as we emerge from the bpanking sector may worsendemic, particularly in relation to asset quality deterioration and potential increases in NPL ratios after the temporary support measures introduced during the COVID-19 crisis are liftedphased out;
Amendment 55 #
Motion for a resolution
Recital D
Recital D
D. whereas some financial institutions in the BU are heavily invested in the debt of their own home sovereignthe sovereign-bank nexus continues to exist and whereas many European banks have high exposure to domestic sovereign debt; whereas this problem is exacerbated by the zero risk weight assigned to sovereign exposures which incentivises over-investment in government bonds; whereas this sovereign-bank nexus could pose financial stability risks and therefore must be addressed through EU solutions to modify risk weights for sovereign exposures;
Amendment 70 #
Motion for a resolution
Recital E a (new)
Recital E a (new)
E a. whereas in November 2021 the ECB comprehensively assessed the state of climate-related and environmental (C&E) risk management in the banking sector which demonstrated that banks have made progress in adapting their governance and policies but that there is a need to deploy forward- looking risk management tools that can capture longer-term climate-related and environmental risks;
Amendment 75 #
Motion for a resolution
Recital F
Recital F
F. whereas there are numerous challenges to the digitalisation of finance; digitalisation of finance has brought about important technological advances in the EU banking sector through increased efficiency in the provision of banking services and a greater appetite for innovation; whereas the digitalisation of finance also presents challenges to the EU banking sector due to cybersecurity risks, data privacy, reputational risks, AML risks and consumer protection concerns; whereas the digitalisation of finance will have a significant impact on face-to-face banking as well as the availability of banking services in rural areas;
Amendment 80 #
Motion for a resolution
Recital F a (new)
Recital F a (new)
F a. whereas financial institutions rely increasingly on the use of information and communications technology (ICT) which heightens the risk of cyber-attacks; whereas the EU banking sector must increase its cyber resilience to ensure that ICT systems can withstand various types of cyber security threats;
Amendment 83 #
Motion for a resolution
Recital G
Recital G
G. whereas there is an urgent need for more effective EU anti-money laundering supervision; whereas there still exists major differences in approach taken to AML/CFT supervision by national authorities and in the application of EU AML legislation;
Amendment 90 #
Motion for a resolution
Recital H
Recital H
H. whereas consumers, investors and all depositors should be well protected in the context of a well-functioning Banking Union and should be kept well informed of any decisions that impact them;
Amendment 94 #
Motion for a resolution
Recital I
Recital I
I. whereas one of the key objectives of Banking Union is that taxpayers should not bear the cost of remedial action when a bank fails;
Amendment 103 #
Motion for a resolution
Paragraph 1
Paragraph 1
1. Recalls that onea key goal of the BU is the security of the banking system and the prevention of bank bailouts by taxpayers; recognises that through the establishment of the SSM and the SRM, Europe's banks are now in a stronger position to withstand financial shocks; notes, however, that the third pillar of the BU (EDIS) is still pending and therefore supports efforts to strengthen the BU; stresses that a solid BU will result in increased confidence in the banking sector and will ensure that EU banks are stronger and better supervised;
Amendment 114 #
Motion for a resolution
Paragraph 2
Paragraph 2
2. Considers that the BU should be built up in a friendly and attractive way, including for Member States outside the euro areacoherent and robust way while providing opportunities and incentives for Member States outside the euro area to join; recognises that participation in the Banking Union is inextricably linked to the respective EU standards and legislation; welcomes the entry of Bulgaria and Croatia into the Banking Union and the inclusion of the Bulgarian lev and the Croatian kuna in ERM II and welcomes the close cooperation established between the ECB and the Bulgarian National Bank and Croatian National Bank;
Amendment 121 #
Motion for a resolution
Paragraph 2 a (new)
Paragraph 2 a (new)
2 a. Stresses that the completion of the Capital Markets Union alongside the development of the Banking Union will help to deliver better conditions for the financing of the European economy, for both households and companies that are still largely reliant on bank credit to foster investments and job creation, while also contributing to the resilience of the European economy;
Amendment 122 #
Motion for a resolution
Paragraph 3
Paragraph 3
3. Stresses that the relatively good performance of banks during the COVID- 19 crisis is related to the policies implemented by the Member States during the pandemic, as well as to temporary measures under Regulation (EU) 575/2013 (Capital Requirements Regulation); the Capital Requirements Regulation (CRR) 'quick fix' which supported banks’ lending capacity to households and businesses; considers that the BU has enabled European banks to weather this crisis in a resilient manner as the banking sector is better-capitalised and less-leveraged than a decade ago;
Amendment 135 #
Motion for a resolution
Paragraph 4
Paragraph 4
4. Recalls the key role of the EU banking sector in financing the recovery of the European economy and considers that the recovery will also depend on banks having sufficient capital to provide credit, particularly as public support measures in Member States are gradually removed;
Amendment 156 #
Motion for a resolution
Paragraph 5
Paragraph 5
5. Notes that the EBA, the ECB and the SRB still see many problems in the banking system, such as high stocks of non-performing loans (NPLs), exposures to sectors which are sensitive to the COVID- 19 crisis, deficiencies in risk management, and discrepancies in the implementation of International Financial Reporting Standard 9 (IFRS 9); underlines with concern that these problems are likely to increase after the withdrawal of the emergency measuresstresses that EU and national supervisors must monitor these risks closely as emergency public support measures are withdrawn;
Amendment 168 #
Motion for a resolution
Paragraph 6
Paragraph 6
6. Supports the ongoing work on the implementation of the Basel III ruleagreement and welcomes in this context the Commission's legislative Banking Package of 27 October 2021; considers that in the implementation process, the Union must ensure full compliance with Basel standards while also taking into account the specificities and diversity of the European banking sector and ensuring that there is no significant increase in overall capital requirements;
Amendment 177 #
Motion for a resolution
Paragraph 7
Paragraph 7
7. NotWelcomes that the banking sector is adapting to the challenges of digitalisation; stresses the need for further investments, research and adequate regulations; appreciates the work on the digital finance package; considers that the priority should be customer safety, inclusiveness and technological neutralityand opportunities of digitalisation which will enable banks to better serve their customers; stresses the need for further investments in IT systems, R&D and the development of a regulatory framework that is fit-for-purpose to respond to digitalisation trends and based on technological neutrality; welcomes the progress made on the digital finance package; considers that consumer protection must be strengthened in a digital context and that financial inclusion should be prioritised, particularly through improved digital and financial literacy; stresses that there is a need for banks to preserve extensive face- to-face banking services, particularly in rural areas; observes with interest the work on the digital euro;
Amendment 185 #
Motion for a resolution
Paragraph 7 a (new)
Paragraph 7 a (new)
7 a. Stresses that the banking sector is particularly vulnerable to the threat of cyber-attacks due to the vast amount of customer data and financial assets held by banks; welcomes, in this regard, the progress made on the proposals for a regulation and a directive on digital operational resilience for the financial sector (DORA) which will ensure that banks have in place robust ICT risk management frameworks, adequate ICT- related incident management processes, regular digital operational resilience testing and rules for the management of third party ICT risk;
Amendment 202 #
Motion for a resolution
Paragraph 9
Paragraph 9
9. Notes that there is a prospect of gradually phasing out emergency measures and returning to pre-COVID-19 capital requirementpublic support measures in a coordinated and coherent way; considers that throughout this process the ability of banks to bear risks and provide financing will be critical since many highly indebted firms will need to deleverage and boost equity; stresses that the European banking sector will need to provision appropriately for impaired loans and cautions against a sudden release of pandemic-related loan loss provisions;
Amendment 209 #
Motion for a resolution
Paragraph 10
Paragraph 10
10. Considers the reduction of NPLs should remain a priority; warns that their number is likely to increase rapidly after the withdrawal of removal of emergency public support measures increases the risk of a further build-up of NPLs; however, welcomes that the aggregate non-performing loans (NPL) ratio in the euro area decreased further to 2.17% in the third quarter of 2021, the lowest level recorded since supervisory banking statistics were first published in the second quarter of 2015; notes the ECB's Financial Stability review of 17 Novembergency support measures 2021 which states that the full impact of the pandemic on bank asset quality could take another two years to become visible; draws attention to the importance of prudential compliance, early identification and proactive management of NPLs;
Amendment 224 #
Motion for a resolution
Paragraph 11
Paragraph 11
11. Is concerned about the rising level of sovereign debt on the balance sheets of banks in the BU; notes that government bonds are not risk-free assets and that risks are differentiated; emphasises that the issue of regulatory treatment of sovereign exposures requires an in-depth examination of the consequences of different approachshould be addressed through modification of risk weights for sovereign exposures;
Amendment 240 #
Motion for a resolution
Paragraph 12
Paragraph 12
12. Notes that the transition to a low- carbon economy presents new challenges and risks related to the preference for sustainable investments; stresses the need for an in-depth analysis of the economic efficiency of sustainable investments in order to avoid a future bubble of green assets; calls forand requires significant sustainable investments from the public and private sector; calls for clear guidelines for banks based on economic data and welcomes the efforts of the SSM to provide guidance and clear guidelines for banks based on economic dataity to banks for self-assessment and the appropriate reporting of environmental and climate change-related risks;
Amendment 257 #
Motion for a resolution
Paragraph 14
Paragraph 14
Amendment 275 #
Motion for a resolution
Paragraph 15
Paragraph 15
15. Indicates thatNotes the trend towards increased consolidation in the banking sector is likely to increase as a result of the pandemic; recognises the challenges posed to banking supervision by large systemically important institutions, whose possible problems may affect financial stability in many jurisdictions; n Europe in recent years; notes that European banking merger and acquisition activity in 2021 is on track to outpace both 2020 and 2019 levels due to a range of factors, including cost pressures, low interest rates and digitalisation1a; recognises the challenges posed to banking supervision, particularly in the context of resolvability, but also notes the possible benefits of banking consolidation including addressing low profitability, overcapacities and fragmentation of the banking sector; welcomes the ECB's Guide on the supervisory approach to consolidation in the banking sector which outlines supervisory expectations regarding consolidation projects2a ; _________________ 1a https://www.spglobal.com/marketintellige nce/en/news-insights/blog/a-new-dawn- for-european-bank-ma-top-5-trends 2a https://www.bankingsupervision.europa.e u/press/pr/date/2021/html/ssm.pr210112~ 920b511a1c.en.html
Amendment 288 #
Motion for a resolution
Paragraph 16
Paragraph 16
16. Notes the problems and challenges related to home/host issues; points out that greater market integrationat home-host issues remain a challenge for the completion of BU; calls for greater market integration, which involves better co-ordination between home and host bank supervisors and requires credible safeguards in EU law for host Member States;
Amendment 290 #
Motion for a resolution
Paragraph 16 a (new)
Paragraph 16 a (new)
16 a. Considers that an integrated Banking Union must be contingent on a well-functioning single market for retail financial services; calls on the Commission to assess the obstacles and barriers that arise for consumers when availing of retail banking products such as mortgage loans on a cross-border basis and to propose solutions to ensure that consumers can benefit from retail financial services across borders; notes, furthermore, the high discrepancy in mortgage interest rates across the Union;
Amendment 293 #
Motion for a resolution
Paragraph 17
Paragraph 17
17. Stresses the need for more effective anti- money laundering supervision; notes the Commission’s adoption of the anti-money laundering (AML) package of proposals; and harmonisation since the existing framework still suffers from several shortcomings and uneven national transposition; stresses that banks act as gatekeepers in the fight against money laundering and therefore must have in place robust risk management frameworks and be supervised effectively; welcomes the Commission’s anti-money laundering (AML) package of proposals of 20 July 2021 and calls for a swift agreement of all proposals; welcomes in particular the proposal for a new Anti- Money Laundering Authority (AMLA) which will supervise the enforcement of AML/CFT rules by Member States; stresses that for AMLA to be truly effective, it must be resourced efficiently;
Amendment 309 #
Motion for a resolution
Paragraph 18
Paragraph 18
18. Underlines the need importance of strengthening consumer and investor protect consumers from abuses and harmful practicesion; notes that despite strong EU consumer protection rules, national rules implementing European consumer protection requirements vary across the Banking Union, pointing to the need for harmonisation;
Amendment 312 #
Motion for a resolution
Paragraph 18 a (new)
Paragraph 18 a (new)
Amendment 315 #
Motion for a resolution
Paragraph 18 b (new)
Paragraph 18 b (new)
18 b. Calls on EU institutions and bodies to prioritise the achievement of full gender balance as soon as possible, including by providing gender-balanced shortlists of candidates for all future appointments requiring Parliament’s consent, including at the ECB and the EU’s top financial institutions, endeavouring to include at least one female and one male candidate per nomination procedure; recalls its resolution of 14 March 2019 aiming to secure gender balance in the forthcoming list of candidates for EU economic and monetary affairs nominations and reiterates its commitment not to take into account lists of candidates where the gender balance principle has not been respected;
Amendment 317 #
Motion for a resolution
Paragraph 19
Paragraph 19
19. Welcomes the activities of the SRB in 2021, including the further completion of the Single Resolution Fund; welcomes that overall banks under the SRB’s remit have delivered good progress towards resolvability and in building up loss- absorbing capacity; takes note of the SRB’s work programme for the coming years, which includes making the effective resolution of all banks under the SRB possible by 2023;
Amendment 325 #
Motion for a resolution
Paragraph 20
Paragraph 20
20. Supports the specification of the public interest assessment criteria so that the SRM is applied in a more consistent and predictable manner; proposes that options should be considered for an alternative common liquidation regime for small and medium-sized banks be considered; asks for a more proportionate setting of; notes the importance of the SRB taking a proportionate approach for banks to build their minimum requirement for own funds and eligible liabilities (MREL) level;
Amendment 339 #
Motion for a resolution
Paragraph 21
Paragraph 21
21. Supports the updarevisiting of State aid rules in order to ensure their greater adequacy and consistency with the SRM framework to reflect progress in the implementation and improvement of the crisis management framework; emphasises that one of the goals of such an update should be to enable quick and effective interventions under the SRM or in the alternative liquidation regime;
Amendment 362 #
Motion for a resolution
Paragraph 23
Paragraph 23
23. Notes the ongoing discussion of various concepts for the EDIS; welcomes the renewed efforts of the Eurogroup in progressing Banking Union in order to reach agreement on the different work streams and files, including EDIS; reiterates Parliament's commitment to working towards an agreement on the EDIS, which should be combined with appropriate risk reduction measures;