During his appearance before the European Parliament’s Committee on Economic and Monetary Affairs on Tuesday 26 February, Jose Maria Campa, the Santander group’s Spanish Head of Regulatory Affairs has promised to avoid any conflicts of interest by not handling any files from his current employer when he takes over the presidency of the European Banking Authority (EBA).
When questioned by Markus Ferber (EPP, Germany), Pervenche Berès (S&D, France) and Ernest Urtasun (Greens/EFA, Spain), Mr Campa did not deny the "very obvious" risk of a potential conflict of interest, but instead talked about his knowledge of the banking sector being an asset for working towards financial stability.
"I will need to be careful and fair in my dealings with banks and influential groups [...] I will need to demonstrate that I can stand aside, if I need to", he said. He said he would be willing to report to MEPs if they felt that, in making a specific decision, he might have been influenced by his previous role. Mr Campa will resign from his post at Santander when his appointment as Head of the EBA has been confirmed.
Mr Campa intends to continue the work begun by his Italian predecessor, Andrea Enria, who has taken over management of the ECB's Single Supervisory Mechanism. He has undertaken in particular to respect the "fundamental” principle of proportionality in applying prudential banking regulations, in particular in implementing the most recent Basel Accord. The target of a 10% reduction in regulatory costs for small banks remains the same.
The criteria on which banking stress tests are based will also be refined, as they have made it possible to "increase transparency significantly" by allowing the most vulnerable banks to be identified, in the opinion of the former Spanish Secretary of State for the Economy.
Questioned by Ms Berès about the fight against money laundering (see EUROPE 12192), Mr Campa replied that he did not believe that granting the EBA four additional full-time posts as part of the ongoing reform of the rules went far enough. The reform will give the European authority a “coordinating” role in the fight against money laundering.
"This is the first step towards a long-term solution, but it is not enough”, he said.
Despite the S&D group's criticism of gender inequality in the allocation of senior European roles in the banking sector (see other news), MEPs approved his appointment by a comfortable majority (by 35 votes in favour to 8 against, with 5 abstentions).
Approval for the appointment of Mr Laviola to the Single Resolution Board
On Tuesday, the parliamentary committee also approved (by 37 votes in favour to 8 against, with 3 abstentions) the appointment of Sebastiano Laviola as a member of the Single Resolution Board (SRB), the body responsible for restructuring any large failing bank within the Eurozone banking union.
Mr Laviola mentioned several ongoing projects: - finalisation of resolution plans for all banks, the smallest ones on this occasion; - work to remove obstacles to bank resolution; - assessment of the critical functions of cross-border groups; - preparation for all eventualities as a result of Brexit. He supported completion of the banking union through creation of a European Deposit Insurance Scheme (EDIS).
When asked about specific differences in regulatory treatment applied during resolution of a bank, Mr Laviola did not deny the existence of cases where the national resolution authorities applied different rules in the same banking group, as happened in the case of the Latvian bank ABLV (see EUROPE 12017).
There are "tensions between national authorities" when the failure of a group is managed by Member States, Mr Laviola admitted, pointing to a potential "asymmetry" in regulatory treatment. He added: "If responsibilities are centralised, funds must be centralised. Governance would be much simpler" (Original version in French by Mathieu Bion)