The European Parliament and the EU Council reached an interinstitutional agreement on the legislative package to reduce financial risks in the banking sector, after the Ecofin Council gave its political endorsement to the key results of the interinstitutional negotiations on Tuesday 4 December (see EUROPE 12150).
"Austria is very proud" of having been able to foster political agreement on new prudential rules that will make it possible to incorporate the TLAC standard into EU law and ensure that public money is better protected in the event of bank failure, Austrian Minister Hartwig Löger said after the Ecofin Council.
During the ministerial debate, several countries took the floor to congratulate the Austrian Presidency for its success in retaining the overall balance of the Council's political agreement in principle during negotiations with Parliament. Belgium stressed the importance of the balance between a banking group’s country of origin and its hosts (‘home/host'). Italy nevertheless advocated cautious use of the rules on subordinated instruments that could be used in the event of an internal bail-in of a failing banking group.
The Commissioner for the Euro, Valdis Dombrovskis, said an interinstitutional agreement was expected "in the next few hours".
Representatives of Parliament and the Council met again on Tuesday to finalise the interinstitutional negotiations. Issues related to the shadow banking sector, remuneration and governance of financial institutions still need to be resolved.
Political support for the interinstitutional negotiations on the risk reduction package was a precondition for the agreement reached the previous night on the reform of economic and monetary union (see other news).
The main results of the interinstitutional negotiations on the legislative package can be found at: https://bit.ly/2AQ7M7X. (Original version in French by Mathieu Bion)