Message from the CEO, Nina Schindler
With a tall stack of challenges to surmount deriving from a complex geopolitical landscape and the start of the new EU legislative cycle with new political weights from left and right, Europe stands on the brink of important decisions. Addressing the substantial funding needed to pursue a new direction, a competitive and unified EU market will be essential for banks, including cooperative banks, to efficiently finance innovative and green solutions, contribute to citizens’ financial wellbeing, and ensure prosperous European regions and economies.
The EACB is committed to keeping the flags flying for the cooperative values of proximity, solidarity and long-term focus in European banking. In this spirit, we have created a roadmap with recommendations to establish a regulatory landscape that supports European competitiveness and a strong single market 2.0. This vision includes enabling Europe’s companies and citizens to reap the benefits of the cooperative model. Recognising banking diversity as an integral component of the single market, and applying the principle of proportionality in legislation, will not only help cooperative banks but will also better support the needs of Europe’s regions and local communities.
I am pleased to welcome Priscille Szeradzki as the new face of the EACB leading our Association as its President through this crucial mandate.
This edition will feature a set of interview questions offering unique insights on the roadmap for financial services policy over the next five years. To look at what we can expect for the new term, we have asked Mr Ferber, a seasoned politician and member of the European Parliament, for the Parliament’s approach and priorities. These perspectives are enriched by Priscille Szeradzki’s views pinpointing key challenges and opportunities ahead for cooperative banks in Europe.
3 Questions to Markus Ferber, Member of the European Parliament
Markus Ferber, born in 1965 in Augsburg and an engineer by profession, has been a Member of the European Parliament since 1994. During his time in office, he has served in multiple high-profile roles, such as Chairman of the CSU delegation in the European Parliament and Co-Chairman of the CDU/CSU delegation in the EPP Group. In the last EU mandate, he served as the Coordinator of the European People's Party (EPP) in the European Parliament’s Economic and Monetary Affairs Committee (ECON).
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- First of all, allow us to congratulate you on your re-election as member of the European Parliament on behalf of the Christlich-Soziale Union in Bayern e.V. (Germany) to the European People’s Party. This will be your 7th parliamentary term. Taking your experience from the past and looking at the future, what do you see as the main challenges for this next European Parliament?
Thank you for your kind wishes. The upcoming legislative term will be both a challenging and hugely important one. The European Union faces many difficult challenges. With Russia’s war of aggression in Ukraine and all its domestic implications, protectionist tendencies all across the world and the rise of populist movements even within the EU, it is fair to say that the world has become a more uncertain place. However, that also means the case for a capable European Union is stronger than ever and we have to act accordingly. I see two big topics for the next legislative term: strengthening the EU’s capacity to act in the world and increasing the EU’s economic competitiveness to boost growth and our overall economic welfare.
- Zooming in on financial services, a sector you have extensively worked on as a member of the ECON Committee in previous terms, what do you consider to be the top priorities for the next legislative term?
We very much welcome the Eurogroup’s statement on the future of the Capital Market Union. It sets the vision of where the Member States see a need for action and will of course inform the Commission’s thinking about the next financial services agenda. A key area where we see potential in the near future is securitisation – consensus is emerging around the need to revive the EU market. The goal is clear: enable banks to increase their lending potential by freeing their balance sheets, while preserving financial stability. Another area where Member States tend to share views is the need to mobilise savings to deepen our capital markets and generate long-term returns for EU retail investors. This is a complex area, which will require a series of coherent actions.
- The EACB recently issued a list of recommendations for the next Commission and co-legislators in its publication “Cooperative Banks’ contribution to the Future of Europe: Toward Single Market 2.0 and European competitiveness”. These recommendations include, among others, adopting more principle-based legislation, embracing a “less is more” philosophy, and translating proportionality into more concrete measures that foster a diverse banking landscape with strong regional champions. What approach could the next Parliament take to strengthen European competitiveness and the Single Market?
It is certainly fair to say that the regulatory load in the past couple of years was particularly high and came with significant compliance costs for the industry. In certain areas, this has eroded our overall competitiveness. With many of the big financial services files having been reviewed during the past mandate, I think it is time to change course and to think more about coherence, consistency and proportionality in legislation. That also means getting rid of things like overlapping reporting requirements, streamlining the body of financial services legislation where necessary and rethinking the mandate and accountability of the European Supervisory Authorities. The goals is to cut red-tape, become more competitive without compromising on financial stability.
Reflections by Priscille Szeradzki, President of the EACB and Deputy CEO, CNCM
Priscille Szeradzki, born in 1985 in Poitiers, currently serves as the Deputy CEO of Confédération Nationale du Crédit Mutuel (CNCM), the central body of Crédit Mutuel group. Before joining the group, she worked in the field of international relations, for the French agency in charge of granting asylum, and as a diplomat for the Ministry of Foreign Affairs. She then joined the Ministry of Economy and Finance, where she led significant projects and negotiations at the international, European, and national levels. Notably, during the COVID-19 crisis, Ms Szeradzki was in charge of formulating restructuring plans for major companies facing challenges.
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- Congratulations on your recent appointment as President of the EACB. You are the current Deputy CEO of CNCM, and have an extensive background including experience in international relations, and as a diplomat for the French Foreign Ministry. From where you stand now, what do you see as key challenges for the cooperative model in banking?
Thank you for your congratulatory words. I am very honoured to have been elected President of the EACB and am very grateful to members for their trust.
From where I stand, I see three main challenges: geopolitical, with the war on Europe’s doorstep; environmental, with the rising effects of climate change; and social, with inequality, and social exclusion fracturing European society. In this “uncertain place” as Mr Ferber aptly described it, there are two ways to react: withdraw into oneself and follow a movement reverse to EU construction or, on the contrary, build on our cohesion and reinforce our unity. My deep conviction is that we need a stronger Europe.
It may sound tautological but to reach a stronger Europe - one capable of facing geopolitical and environmental issues while protecting its citizens - we need a robust economic sector. Cooperatives are key to reaching this goal. With their common values of strong democratic governance, solidarity, inclusion, and close proximity to their clients, EACB’s member banks bring concrete answers to European citizens and companies.
- Focusing on the regulatory environment, and responding to Mr Ferber’s suggested approach, what course do you think the next EU Parliament and Commission should take?
Sound banking regulation is essential to ensure a stable financial system. But the capacity of banks to build long-term and sustainable business models throughout Europe, serving all populations, is at least as vital. The policymaking and supervisory processes should leave room for banks to develop strong and various business models, not discriminate between different kinds of banks and inherently cater for diversity rather than opt for a one-size-fits-all approach.
Promoting a diverse banking landscape that allows both big European champions and strong regional champions to develop will indeed help ensure that every corner of Europe can partake in economic growth potential. With their strong orientation and proximity to the population, their long term capital, cooperative banks are a stabilising force. The cooperative difference is therefore not a luxury, but essential to financial stability in Europe.
- As the new EACB’s President, what do you consider to be the top priorities of your next two-years mandate?
The EACB’s recommendations in Cooperative Banks’ Contribution to the Future of Europe sets the priorities very well, and thanks to the work of my predecessors as well as the EACB staff and administrators, I inherit a clear roadmap.
Within this roadmap, two priorities stand out for me:
- Diversification. Everywhere in Europe, cooperative banks have to remain the bank for everyone, the insurer of all risks, and the provider of a wide range of services. Diversification is key. To achieve this, it is vital to preserve their stability and their financing capacity. For that, I’ll keep a very close eye on three specific points of vigilance in the next coming months: the digital Euro, the reform of the ECB reserve requirements, and the Danish compromise.
- Energy transition. Cooperative banks need to be given the right framework to play their role in making the energy transition possible for all customers, at the local level where they are strongly established. We need to find the way to make the best use of finance as a lever to reach sustainable development goals. It means, for instance, making the taxonomy work so that it does not hamper green investments.