Upon his arrival in Brussels on Monday 10 June, the German finance minister, Wolfgang Schäuble, called for increased harmonisation of the national insolvency regimes – a subject on the agenda of the meeting of the Eurogroup and of the 'Economic and Monetary Affairs' Council of 11 July.
Referring to the recent bank bailout operations in Spain and Italy, he expressed regret at the differences between the national rights of failing banks and the European rules. “We need to talk about how we can change this in the future”, he said upon his arrival.
Along the same lines, the President of the Eurogroup, Jeroen Dijsselbloem, said that he hoped to speed up the process of a gradual harmonisation of the insolvency frameworks between countries.
In response to observers who feel that Italy has acted against the spirit of banking union in the Eurozone by mobilising public money to restructure the bank Monte dei Paschi di Siena and to liquidate to Venetian banks (see EUROPE 11816, 11822), Italian minister, Pier Carlo Padoan, said that the two crises had been guided through a difficult transition phase by passing on the cost – as little as possible – to taxpayers and the economy. This reinforces banking union, he argued.
NPL. With the question of national supervisory practices and legal frameworks for non-performing loans (NPL) also discussed at the Eurogroup, the European Commission on Monday launched a public consultation to explore possible initiatives to facilitate the development of secondary markets for NPL. “If banks were able to offload legacy assets from their balance sheet better via secondary markets of credit, they could use their managerial capacity more on evaluating new lending business”, said the Commissioner for Financial Services, Valdis Dombrovskis, in a press release.
The consultation, which will run until 20 October, will also give the stakeholders the opportunity to take position on a new instrument, the 'accelerated loan security', which aims to increase the protection of creditors guaranteed against borrowers' default in order to improve the functioning of the market for lending to SMEs.
This exercise will also feed into the Commission's reflection on a future legislative proposal on the subject, which was announced on 8 June of this year as part of its mid-term revision of the action plan for the Capital Markets Union (see EUROPE 11804).
On Tuesday 11 July, the European ministers for the economy and finance are also expected to adopt an action plan to tackle NPL via a global approach bringing together different measures at both national and European level to reduce the current volume of NPL and, in particular, to prevent any future build-up of these receivables on banks' balance sheets (see EUROPE 11825). (Original version in French by Marion Fontana)