Luis Teijeiro, Director of Regulation and Research at CECA, addresses the contributions made with regard to solvency and financial sustainability.
We analyse the contributions proposed by CECA with a view to the Spanish Presidency of the Council of the European Union that will take place in the second half of this year. To that end, Luis Teijeiro, Director of Regulation and Research at CECA, joined us for this Thursday's Entrevista Capital.
Solvency of the financial sector, a key proposal for CECA
These weeks are crucial for the financial sector. Discussions on the banking package trialogues are being finalised. "We are concerned about the capital floor of banks", admits Teijeiro. Some jurisdictions are working towards obtaining a series of transitional provisions from the European Commission to help banks affected by this measure to adapt to this capital floor.
"The existence of transitional provisions will affect the comparison of capital ratios for many years to come. And if it becomes permanent, we would not achieve the objective of this regulation, which is to improve the comparability of capital ratios between banks at the European level".
And in terms of sustainability?
He argues that European regulations have accorded the financial sector a "very important" role in recent years. "We are the transmission chain connecting finance to the economy", he acknowledges.
The aim of the European authorities is therefore to use the financial sector to steer investments in the coming years towards sustainable purposes and green finance.
"We are concerned that we may be given a difficult role to fulfil without a transparent and objective reporting framework. There is no uniform guidance at European level for banks to verify whether a project is sustainable or not".
