208

result(s)

Word(s)
Publication type
Author
Keyword
Date

Economic Dialogues and Exchanges of Views with the Member States under the European Semester Cycles - State-of-Play (March 2017)

28-03-2017

This table provides a regular update on Member States invited for an Economic Dialogue in the competent Committee of the European Parliament.

This table provides a regular update on Member States invited for an Economic Dialogue in the competent Committee of the European Parliament.

Economic Dialogue with the Other EU Institutions under the European Semester Cycle (State-of-Play, March 2017)

22-03-2017

This document provides an overview of forthcoming and undertaken Economic Dialogues with the other institutions of the European Union under the European Semester Cycle(s). It is updated on a regular basis.

This document provides an overview of forthcoming and undertaken Economic Dialogues with the other institutions of the European Union under the European Semester Cycle(s). It is updated on a regular basis.

Economic Dialogue with Croatia

22-03-2017

This note presents selected information on the current status of the EU economic governance procedures and related relevant information in view of an Economic Dialogue with Zdravko Maric, Croatia’s Minister for Finance, in the ECON committee of the European Parliament. The invitation for a dialogue is in accordance with the EU economic governance framework.

This note presents selected information on the current status of the EU economic governance procedures and related relevant information in view of an Economic Dialogue with Zdravko Maric, Croatia’s Minister for Finance, in the ECON committee of the European Parliament. The invitation for a dialogue is in accordance with the EU economic governance framework.

Fines for Misconduct in the Banking Sector – What Is the Situation in the EU?

20-03-2017

This paper was drafted under supervision of the Economic Governance Support Unit. Misconduct (conduct) risk may be defined as the risk of losses to an institution arising from an inappropriate supply of financial services, including cases of willful or negligent misconduct. Based on EBA data, it generates the vast majority of operational risks expected by Europe’s top banks (€71bn according to the 2016 stress test). According to public-domain figures, misconduct costs have been rising strongly for ...

This paper was drafted under supervision of the Economic Governance Support Unit. Misconduct (conduct) risk may be defined as the risk of losses to an institution arising from an inappropriate supply of financial services, including cases of willful or negligent misconduct. Based on EBA data, it generates the vast majority of operational risks expected by Europe’s top banks (€71bn according to the 2016 stress test). According to public-domain figures, misconduct costs have been rising strongly for large European banks in 2011-2015, although no European lender matches the costs experienced by large US banks. The distribution of losses looks highly skewed, with a few exceptionally high costs. More than 55% originates from traditional areas like commercial and retail banking. There are signs that conduct costs (per unit of total assets) have been stronger for small and mid-sized institutions, and for banks that ended up in resolution or requiring some other form of extraordinary support. Conduct risk is addressed by a number of EU-wide regulations and supervisory standards. Still, only half of the EU’s competent authorities include conduct risk in their supervisory examination programmes. To discipline conduct risk ex post sanctions play a useful role, but should be complemented by ex ante tools like improving the quality of bank governance, preventing remuneration schemes that encourage inappropriate practices, encouraging whistle-blowing and improving the clarity of regulations to remove grey areas.

External author

Andrea Resti

Fines for Misconduct in the Banking Sector – What Is the Situation in the EU?

20-03-2017

This paper was drafted under supervision of the Economic Governance Support Unit. Bank regulators have the discretion to discipline banks by executing enforcement actions to ensure that banks correct deficiencies regarding safe and sound banking principles. We highlight the trade-offs regarding the execution of enforcement actions for financial stability. Following this we provide an overview of the differences in the legal framework governing supervisors’ execution of enforcement actions in the ...

This paper was drafted under supervision of the Economic Governance Support Unit. Bank regulators have the discretion to discipline banks by executing enforcement actions to ensure that banks correct deficiencies regarding safe and sound banking principles. We highlight the trade-offs regarding the execution of enforcement actions for financial stability. Following this we provide an overview of the differences in the legal framework governing supervisors’ execution of enforcement actions in the Banking Union and the United States. After discussing work on the effect of enforcement action on bank behaviour and the real economy, we present data on the evolution of enforcement actions and monetary penalties by U.S. regulators. We conclude by noting the importance of supervisors to levy efficient monetary penalties and stressing that a division of competences among different regulators should not lead to a loss of efficiency regarding the execution of enforcement actions.

External author

Martin R. Götz and Tobias H. Tröger

Fines for Misconduct in the Banking Sector – What Is the Situation in the EU?

20-03-2017

This paper was drafted under supervision of the Economic Governance Support Unit. The US system for addressing bank misconduct through fines delivers a number of lessons for the EU with regard to the design of bank enforcement architecture and the need to develop common approaches across national and EU levels with a view to avoiding regulatory arbitrage. Following the crisis, the highest money penalties imposed on banks in the US related to mis-selling of financial products – a criminal offence ...

This paper was drafted under supervision of the Economic Governance Support Unit. The US system for addressing bank misconduct through fines delivers a number of lessons for the EU with regard to the design of bank enforcement architecture and the need to develop common approaches across national and EU levels with a view to avoiding regulatory arbitrage. Following the crisis, the highest money penalties imposed on banks in the US related to mis-selling of financial products – a criminal offence falling under the remit of Department of Justice – rather than to breaches of prudential supervisory requirements.

External author

Elena Carletti

Economic Dialogue with the President of the Eurogroup - ECON on 21 March 2017

17-03-2017

Jeroen Dijsselbloem, President of the Eurogroup, has been invited to a regular Economic Dialogue, in particular, in accordance with Article 2ab of Regulation 1466/97 as amended. This briefing provides an overview of the ongoing work of the Eurogroup as regards public finances, macro-economic imbalances, financial adjustment programmes and the banking union. Mr Dijsselbloem has been the Eurogroup President since January 2013. As the President of the Eurogroup, he is also chairing the Board of Governors ...

Jeroen Dijsselbloem, President of the Eurogroup, has been invited to a regular Economic Dialogue, in particular, in accordance with Article 2ab of Regulation 1466/97 as amended. This briefing provides an overview of the ongoing work of the Eurogroup as regards public finances, macro-economic imbalances, financial adjustment programmes and the banking union. Mr Dijsselbloem has been the Eurogroup President since January 2013. As the President of the Eurogroup, he is also chairing the Board of Governors of the European Stability Mechanism.

Macro-Financial Assistance to EU Member States - State of Play, March 2017

16-03-2017

This document provides regularly updated information on EU Member States receiving financial assistance from the ESM, the EFSF, the EFSM, the EU balance of payments assistance facility, other Member States and/or the IMF. It also covers the post-programme reviews undertaken by the European Commission (EC) in liaison with the ECB (Post-Programme Surveillance, PPS), the IMF (Post-Programme Monitoring, PPM) and the ESM (Early Warning System, EWS).

This document provides regularly updated information on EU Member States receiving financial assistance from the ESM, the EFSF, the EFSM, the EU balance of payments assistance facility, other Member States and/or the IMF. It also covers the post-programme reviews undertaken by the European Commission (EC) in liaison with the ECB (Post-Programme Surveillance, PPS), the IMF (Post-Programme Monitoring, PPM) and the ESM (Early Warning System, EWS).

Carving Out Legacy Assets: A Successful Tool for Bank Restructuring?

15-03-2017

This briefing drafted under supervision of the Economic Governance Support Unit reviews the options for a separation of non-performing and other problematic assets from the main business of a bank. This separation is essential for bank rehabilitation, though secondary loan markets are illiquid, and plagued by problems in valuation and information sharing. Independent asset management companies are therefore needed, in particular as a tool in resolution. The legal framework for such institutions should ...

This briefing drafted under supervision of the Economic Governance Support Unit reviews the options for a separation of non-performing and other problematic assets from the main business of a bank. This separation is essential for bank rehabilitation, though secondary loan markets are illiquid, and plagued by problems in valuation and information sharing. Independent asset management companies are therefore needed, in particular as a tool in resolution. The legal framework for such institutions should now be prepared.

External author

Alexander Lehmann

Carving Out Legacy Assets: A Successful Tool for Bank Restructuring?

15-03-2017

This paper was drafted under supervision of the Economic Governance Support Unit. European banks have accumulated more than €1 trillion in non-performing loans (NPLs) on their balance sheets after the burst of the 2007-2009 great financial crisis. The NPLs pose a potential threat to bank stability in euro-area countries such as Cyprus, Greece, Italy, Portugal and Slovenia, where more than 15% of the loans are non-performing. This paper assesses the effectiveness of the various resolution tools to ...

This paper was drafted under supervision of the Economic Governance Support Unit. European banks have accumulated more than €1 trillion in non-performing loans (NPLs) on their balance sheets after the burst of the 2007-2009 great financial crisis. The NPLs pose a potential threat to bank stability in euro-area countries such as Cyprus, Greece, Italy, Portugal and Slovenia, where more than 15% of the loans are non-performing. This paper assesses the effectiveness of the various resolution tools to deal with legacy assets such as NPLs under the resolution framework. On the one hand, the on-balance sheet tools (no tools, sales of entire bank, and asset guarantees) and on the other hand, the tools that carve out the assets from the banks’ balances (selling part of the bank, bridge bank and asset separation) are assessed based on the experiences in the aftermath of the financial crisis. The figures for the 79 euro-area banks that received capital support between 2007 and 2016 show that the differences in bank viability as well as financial and economic stability are fairly similar across tools, except for the sale of the entire business and bridge banks. Taking also the costs (losses and recapitalisation) into account, asset management companies in particular, as well as bridge banks, guarantees and no specific resolution tools, seem under the current conditions to effectively deal with legacy assets such as NPLs.

External author

Willem Pieter de Groen

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