Today, S&D MEPs confirmed their willingness to strike a deal on the reform of the banking sector to put an end to "too-big-to-fail" banks in the European Union.
Yesterday, the S&D members of the economic and monetary affairs committee (ECON) successfully led a majority to reject an attempt by the right wing political groups – Conservatives and Liberals – to water down the European Commission's original proposal on banking separation, aimed at safeguarding the traditional activities of the banks from the more risky operations.
S&D Group spokesperson on economic and monetary affairs, Elisa Ferreira, said:
"The Conservatives and the Liberals thought that they could strike a deal on an empty shell. In the past, the ECON Committee has built a sound reputation and played a constructive role in the building up of a common rulebook, the Single Supervisory Mechanism, the Banking Recovery and Resolution Directive (BRRD) and a Banking Resolution, always by establishing ambitious and credible broad majorities. The attempt from the EPP to impose a narrow majority ended up in defeat. It is urgent that the ECON Committee re-establishes its sound working methods. The S&D Group will continue to work and to search for a compromise, but not at any price."
S&D Group negotiator, Jakob Von Weizsäcker, added:
"Bank lobbyists had high hopes that a rushed attempt to water down former EU Commissioner Michel Barnier's proposal on bank separation would pass the economic and monetary affairs committee. According to these proposals, too-big-to-fail banks would have been able to continue to gamble with taxpayers' implicit guarantees."
"Since too-big-to-fail banks continue to pose a serious risk to taxpayers, we are calling for a reversal in the burden of proof for the largest banks with the most extreme business models. In the future, they should be obliged to demonstrate to bank supervisors beyond any reasonable doubt that they do not present any systemic risks.
"If a bank fails to pass this test, it would then either be split up or, alternatively, the capital requirements would be increased very substantially. We hope that Conservatives and Liberals would eventually support this approach, based on the original Barnier proposal."
