What does CECA propose to the Spanish Presidency of the Council of the EU?

Luis Teijeiro, director of Regulation and Studies at CECA, discusses the contributions they have made regarding financial solvency and sustainability

We analyze the contributions that CECA proposes for the Spanish Presidency of the Council of the European Union, which will take place in the second half of this year. For this, we were joined in this Thursday’s Capital Interview by Luis Teijeiro, director of Regulation and Studies at CECA.

Financial sector solvency, a key proposal for CECA

These weeks are crucial for the financial sector. The trilogues of the banking package are nearing completion. “We are concerned about the capital floor of the entities,” Teijeiro acknowledges. Some jurisdictions are seeking to obtain a series of transitional provisions from the European Commission to help the entities affected by this measure adapt to this capital floor.

“The existence of transitional provisions will affect the comparison of capital ratios for many years. And if it becomes permanent, we would not achieve the objective of this standard, which is none other than to improve the comparison of capital ratios between entities at the European level.”

And what about sustainability?

He maintains that European regulation has been assigning the financial sector a “very important” role in recent years. “We are the transmission chain of financing to the economy,” he acknowledges.

Therefore, the goal of European authorities is to use the financial sector to steer investments in the coming years towards sustainable purposes and green financing.

“We are concerned that we are given a role that is difficult to fulfill and that we do not have a transparent and objective information framework. There is no standardized training at the European level for entities to verify whether a project is sustainable or not.”