Local view for "http://purl.org/linkedpolitics/eu/plenary/2011-05-10-Speech-2-740-000"
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"en.20110510.68.2-740-000"2
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Mr President, I am grateful to everyone who has taken the floor at this late hour for demonstrating the European Parliament’s vigilance, and I would even say its intelligence, on this difficult issue.
Ultimately it will be up to the Member States rather than the EBA to learn lessons by putting in place conditions and backstops, which we will be monitoring closely in the period immediately after the stress tests
When the three European supervisory authorities and the Systemic Risk Board were set up, I said that we were going to test the ground by walking on it. That is what we are doing. I believe that the EBA is doing a good job under the leadership of Mr Enria; the same applies to the other authorities, to the Systemic Risk Board and, Mr Giegold, to the European Insurance and Occupational Pensions Authority (EIOPA). Earlier you mentioned the tests in the insurance sector; the EIOPA is currently preparing a series of tests in that sector, as the EBA did for the banks.
You raised a sensitive and very important issue, Mr Giegold, as did Mr Karas and Mr Schmidt earlier, namely sovereign debt shock. As I have already said, and I will not be saying anything else on the matter this evening, the EBA has been tasked with designing and developing the tests. It felt that a banking book shock was unrealistic, and so there was no point in carrying out tests on the banking book at this stage. All I can say is that we have this dialogue with the EBA, we are determined – Mr Giegold has drawn all the lessons from this new round of tests, just as we drew lessons from the previous round, which was unsatisfactory – and we have an ambition – Mr Sánchez Presedo asked me to show ambition – which is to be demanding and rigorous when holding this dialogue, while respecting the powers and the independence of the EBA, just as we in the Commission demand respect for our own independence. My ambition, Mr Giegold, is to reflect rationally on what we have learnt from this round of tests, which will end in June, and to learn as much as we can from our dialogue with the EBA, in order to improve the following round.
Mr Mann, like you, Mr Giegold, mentioned the evaluation of liquidity risk. As you know, the evaluation of this liquidity risk is not part of the stress test itself, the results of which will be made public. At the beginning of the year, the European Banking Authority announced that it would be carrying out a separate thematic review of the liquidity risks in the EU banking sector as part of its regular risk assessment cycle in the first quarter of 2011. It will therefore address this issue in this parallel context, so to speak.
Mr Karas called on his fellow Members and the Commission to integrate everything that we are doing into long-term strategies, and I would like to say to Mr Karas that this is a general principle to which I subscribe, and it is also the spirit in which I am working with my teams in order to propose all the new legislation that is part of this financial and economic governance that we need. This specifically applies to the issue of governance, to what we are going to do in terms of shareholder liability – we are working from a long-term perspective – and to what we want to do, as I was saying earlier to Mrs Ferreira, with regard to bank resolution. It also applies to another point that I have in mind; although you have not mentioned it, it is one of the reasons for, or one of the causes of, the crisis: the obscene pay and bonuses, which were even higher when more risks were taken, since those taking the risks knew that everyone else would pay for them.
When we review the application of the current guidelines on pay and bonuses, and see where they fall short, I will clearly ensure that, as many of you have requested, they are transposed and applied in every Member State over the coming weeks. When I say that I am considering new guidelines on this issue, it is precisely in order to address one of the causes of the crisis – this crazy risk-taking – and to make those involved in the banking sector more prudent and responsible again.
Mrs Ferreira and Mr Lamberts made the point that the stress tests were inconsistent
I have said what I think about the shortcomings of the previous tests. We need more consistency, we need more Europe in the application of these tests, and that is why the peer review with the EBA will also be very useful.
Regarding the issue of a harmonised bank resolution framework, that is precisely what we are working on, Mrs Ferreira. I can confirm to you that we will be presenting our proposal before the end of the summer, and that we will be relying in a very real and sincere way on many of the proposals you have made.
Several of you, including Mr Ludvigsson, Mrs Ford, Mr Cancian and Mrs Băsescu, just now, called for the tests to be – I shall repeat what I heard – rigorous, credible and transparent. Once again, in the overall context of this financial and economic governance that we are in the process of establishing together, the 2011 tests will be more rigorous, credible and transparent than the previous round, and we are going to build on the lessons and the review of this 2011 round in order to ensure that, as you have requested, the subsequent stages in the banking sector stress tests are even more effective, rigorous, credible and transparent.
Firstly, to come back immediately to the issue raised just now by Mrs Gáll–Pelcz, who talked about the responsibility of the Commission – I am used to facing up to my responsibilities – I would point out that these stress tests that are being performed today have been designed by, and are the responsibility of, the new authority that we have created together, the European Banking Authority. Of course, we are working closely with that authority and we, like the European Central Bank, have helped prepare this new round of tests with the EBA, but it is the EBA that is mainly responsible for this.
Mr Zemke asked a rather broad question about future threats and risks. Firstly, I believe there is no such thing as zero risk, either in this field, or in the environmental field. I think it is very difficult to predict the future, and we know after all, Mr Zemke, that the markets move much more quickly than the age of democracy, than our age, no matter how quickly we move or how quickly and effectively we want to move.
How, though, can we be better prepared than we were four years ago when faced with the crisis that originated in the United States and nearly swept everything away? By creating tools, frameworks for governance, supervision, responsibility, transparency, everything that was lacking, everything that had been part of the very powerful tide of ultraliberalism that first swept through the world in the 1990s, everything that was partially dismantled, too, with the foolish idea that the markets could regulate themselves.
Within the framework of the G20, and perhaps going further in some areas than the G20 had requested, we are today patiently recreating the governance, regulatory, transparency, I was going to say quite simply ‘moral’ – if I can use that word – or ethical frameworks and tools that have been singularly lacking in the financial market set-up for around 15 years.
That is why your understanding of this situation is important, and why your role in creating proper European supervisory authorities – Mrs Goulard mentioned the European Systemic Risk Board – is very important.
That is why – and this is also addressed to Mr Gauzès, who mentioned rating agencies – we are including this action, the specific topic of tonight’s sitting, everything that we are doing patiently, week after week, in the major European financial and economic governance project, and we have more work to do yet. I do not have a problem with using the word federation in the context of this major project; I think it was Mr Giegold who used that word earlier. We need to pool our energies and our policies more, and at times we need to go beyond mere coordination.
I agree with Mr Gauzès on the importance of continuing the reforms in the area of rating agencies. We are working on a third reform, which will complement the previous two. As for the issue that you raised, Mr Gauzès, with regard to excessive dependence on ratings, we are going to get rid of a number of ratings very shortly, at the beginning of July. We are going to get rid of several references to ratings so as to prevent this excessive dependence on ratings by the banks, and not just by the banks in fact. We are going to work on this point, therefore.
Mrs Goulard referred to the comments made by Mr King and Mr Enria, and I have noted them down. I thank her for having drawn my attention to their comments, which demonstrate, moreover, a proactive and changing approach, which I am very pleased about. I should also like to thank her for having mentioned the very important role – and we know how much we owe you, Mrs Goulard – of the Systemic Risk Board. We must work with all these stakeholders and the EBA, and naturally we must have regard for the role of the Systemic Risk Board, so that we apply the stress tests consistently and so that we learn from them."@en1
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