European Banks Unite Against 'Overly Complex' Regulations

Eleven major European banks have sent a joint letter to Brussels requesting a temporary moratorium on new capital requirements and accelerated simplification of banking regulation. The banks, led by Ana Botín from Banco Santander, argue that Europe needs to mobilize large amounts of financing for defense, energy, infrastructure, and strategic technologies.

The group, which includes Barclays, BNP Paribas, BPCE, Crédit Agricole, Deutsche Bank, HSBC, ING, Société Générale, Standard Chartered, and UBS, wants to simplify the capital framework by reducing overlapping requirements. They also propose incorporating a secondary mandate for European financial supervisors to prioritize competitiveness and growth when designing regulation.

The European Central Bank (ECB) has already expressed support for simplification, but under the condition that it should not weaken banks' ability to absorb losses. The ECB is working on its own reform of supervision, reviewing nearly a hundred guidelines and publications to shorten or withdraw those that have become obsolete.