Whatever the post-Brexit relations between the European Union and the United Kingdom, "it is of the utmost importance that the integrity of the single market is respected", said the president of the ECB, Mario Draghi, on Monday 26 September, at a monetary dialogue at the European Parliament. "Any outcome should ensure that all participants are subject to the same rules", he added.
The former governor of the Bank of Italy observed that the markets and the economy had shown resilience following the announcement of the results of the British referendum in favour of the country leaving the EU (see EUROPE 11580). However, the long-term impact on the economic situation of the eurozone remains very difficult to predict and will depend on how long the negotiations take, he argued.
In response to a question from Bryan Hayes (EPP, Ireland), Draghi stressed that the European institution was competent on payment systems, but not clearing mechanisms. He pointed out that if the ECB's competence were to be extended to include clearing, either Article 22 of the ECB articles of association or the 'EMIR' regulation, which governs the activities of the central clearing houses, would have to be amended.
At the end of June, the French president, François Hollande, was the first to challenge the prospect of the clearing market remaining in the United Kingdom once it has become a third country. Indeed, the prospect of Brexit has changed everything on this vital segment of the financial markets, although the UK won a legal battle against the ECB in spring 2015 over the location of the clearing houses in the name of equality of treatment between member states (see EUROPE 11267).
When asked by the MEPs about the fragmentation of the banking market, Draghi said that the financing conditions for SMEs had improved substantially since the end of the sovereign debt crisis. In July 2016, the interest rate gap between small and large loans granted in a vulnerable eurozone country and in another, which had been less affected by the sovereign debt crisis, had moved very much closer together, "a situation not seen since spring 2011". In response to Burkhard Balz (EPP, Germany), who expressed concern at the low bank interest rates, the ECB president said that the disadvantages to savers were more than outweighed by the advantages to investors taking out mortgage loans. This situation is in particular symptomatic of the low long-term growth prospects, he said. (Original version in French by Mathieu Bion)