The Executive Vice-President of the European Commission, Valdis Dombrovskis, gave some details on Thursday 25 June on the package of targeted financial regulatory changes to facilitate economic recovery from the Covid-19 crisis, expected to be released on 22 July (see EUROPE 12509/24).
“This crisis means that many companies will see their debts soar. To stay solvent, they will need to restore sustainable debt-to-equity ratios. The obvious way for them to do this is to raise equity capital on public markets”, he said on the occasion of the 18th Annual European Financial Services Conference.
The Commission wants to help companies affected by the economic shock to recapitalise and will therefore propose specific amendments to the prospectus rules, Mr Dombrovskis said.
The Commission also wants to remove unnecessary burdens on investors by amending the Markets in Financial Instruments Directive (MiFID II) and to increase investment in research, especially for SMEs, he said.
The Commission also aims to further promote simple, transparent and standardised’ securitisation (STS) to free up new loans for the economic recovery. According to our information, it is apparently considering extending the European framework on STS securitisation to ‘balance sheet synthetic securitisation’ as well as removing regulatory barriers to the ‘securitisation of non-performing exposures’.
Dialogue with stakeholders
Valdis Dombrovskis also praised the merits of the dialogue with stakeholders on post-Covid-19 economic and financial measures. On 28 May, the Commission held a first virtual round table bringing together banking, insurance, business and consumer associations to discuss how industry can best support citizens and businesses during the pandemic (see EUROPE 12496/14).
The Commission will hold a second round table, “in the same format”, on Monday 29 June, Mr Dombrovskis announced. (Original version in French by Marion Fontana)