Local view for "http://purl.org/linkedpolitics/eu/plenary/2016-11-21-Speech-1-110-000"

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"Mr President, this debate takes place one week before the next meeting of the Basel Committee in Chile, which will be an important step in the process towards the finalisation of the so-called Basel III agreements with a fundamental review of the banking book. As we know, this review is focused on three groups of measures: the review of the standardised approach for credit and operational risk, in order to enhance the risk sensitivity and robustness; the introduction of constraints to the use of internal models; the potential introduction of capital ouput floor based on the standardised approaches that defines the minimum amount of capital requirement for internally model exposures. The Parliament will be called, as co-legislator, to introduce the outcomes of this review into EU law. Taking into account the relevance and potential impact of the measures under discussion, we consider it necessary to intervene in the debate. We had an exchange of views with the Single Supervisory Mechanism (SSM), the Commission, the European Banking Authority (EBA) and the Secretary-General of the Basel Committee, and we drafted this oral question and the resolution, which has been approved by the Committee on Economic and Monetary Affairs (ECON) with a very broad majority and will now be put to the vote before the plenary. As the resolution clearly states, we believe in the importance of sound global standards, and we reaffirm that banks need to be well capitalised in order to support the real economy and reduce risk. We also consider it important to increase simplicity, comparability and convergence of the risk-weighted capital framework in order to address excessive variability in risk-weighted assets and to apply the same rules to the same risks. However, we think that the current revision, in order to be effective and not to have unintended and counterproductive consequences, needs to fully respect two principles. Firstly, it should not significantly increase overall capital requirements for European banks as the Basel Oversight Board has clearly stated. Secondly, the revision should not have a negative impact on the level playing field at global level. It should not exacerbate – rather it should mitigate – the differences between types of banks and between geographical areas, and it should not unduly penalise the EU banking model. As we know, although the draft standard has been built up by specific proposal subject to public consultations and specific quantitative impact studies, during the summary many concerns have been expressed and it clearly emerged that the various drafts did not respect the two above-mentioned principles. For this reason, we are calling on the Basel Committee to revise its proposals. We also call on the ECB, the SSM and the Commission to ensure the respect of the two principles in the finalisation and monitoring of the new standard. As the resolution clearly states, we consider that this would be instrumental for ensuring a consistent incorporation of the new measures into EU legislation. We understand that some steps in the right direction have been taken, and we encourage all the remaining critical elements to be addressed. As regards the use of internal models, they need to address the variability of risk-weighted assets should not be a reason to drop the sensitiveness of prudential requirement. It should be rather an incentive to deal with lack of organisation in modelling approaches, as the EBA and the SSM have already been doing since 2014, in order to ensure that risk-weighted assets are always consistent with the actual risk behaviour of banking assets. Last, but not least, the resolution expresses concerns about the potential effect on the real economy of the possible introduction of output floors. The output floor is closely linked to the leverage ratio, and the new standard should ensure that the level of calibration of these two measures does not lead to an unintended duplication that could not only end up with an undoubtedly punitive outcome for the euro in terms of capital requirements, but also undermine the effectiveness of the overall reform package. In conclusion, with this resolution the Parliament reaffirms its commitment to work on agreed international standards, but at the same time it warns that those standards should fully take into account the specificity of the EU banking model and strike the right balance between stability and growth. We hope that the adoption of this resolution with a broad majority will contribute to this balanced outcome."@it2
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