Her experience as finance minister and at private financial institutions such as the investment bank Morgan Stanley enabled Portugal’s Maria Luís Casanova Morgado Dias de Albuquerque, European Commissioner-designate for Financial Services, to demonstrate to MEPs, on Wednesday 6 November, that she has mastered the issues she will have to work on within the ‘von der Leyen II’ Commission. However, she did not put forward any major legislative initiatives for the future, focusing instead on a “pause” in the legislative agenda.
By insisting several times on financial stability as the “anchor” of her future action, regardless of the initiatives to be taken to integrate the capital markets into the European Union, and by promising that the competitiveness agenda will not be “an enterprise of financial deregulation”, but rather a way of properly applying the rules that have already been adopted, Ms Albuquerque was keen to reassure the MEPs, who were curious to know her political line.
A number of MEPs on the left of the political spectrum - Jonás Fernández (S&D, Spanish) and Catarina Martins (The Left, Portuguese) - have nevertheless questioned the existence of conflicts of interest with which the former minister may have been confronted, particularly when she was both a national MP and a non-executive director of the Arrow Global investment fund.
These issues have been dealt with by the relevant ethics body, replied Ms Albuquerque, stressing that her role was to ensure that the private financial institution complied with regulatory requirements.
Based on her answers to MEPs’ written questions (see EUROPE 13512/13), Ms Albuquerque warned against the EU’s economic unravelling. “I fear that, without decisive action, Europe will lose its ability to decide its own future”, she added.
One of her top priorities is therefore the integration of capital markets in the EU to ensure a successful economic transition. According to the Commissioner-designate, establishing a ‘Savings and Investment Union’ will require: - boosting demand for greater participation in capital markets; - improving efficiency of supply by a targeted harmonization of laws; - removing barriers to a market-driven consolidation; - considering ways to make cross-border supervision more coherent; - deepening the capital markets, especially for equity investments.
Asked by Ondřej Kovařík (PfE, Czech) to name concrete proposals, the former minister mentioned greater harmonisation of the tax treatment of savings products and streamlining corporate reporting requirements through the use of digital technologies, in particular to simplify life for SMEs. We must avoid “too much bureaucracy”, particularly when it comes to finalising provisions for applying EU law, she insisted.
When Stéphanie Yon-Courtin (Renew Europe, French) asked her about the pan-European Personal Pension Product (PEPP) (see EUROPE 12627/13), she said she wanted to analyse this “failure” before proposing a new product. In her view, this could be based on a 28th legal regime, if this approach proves appropriate.
Asked several times about reviving securitisation, the former minister recommended bringing the current consultation to a conclusion (see EUROPE 13501/27). Aware of the “concerns” inherent in this technique, which enables banks to lighten their balance sheets by selling loans back to the market in the form of securities, she gave assurances that any specific initiative would be tested with regard to financial stability.
In the end, Ms Albuquerque pointed out in response to a question from Isabel Benjumea Benjumea (EPP, Spanish), whatever the market segment, the most important thing is to have a European capital market that allows for economies of scale and is “sufficiently deep and liquid” so that an investor can find the right financial counterparty for his needs, whatever his point of entry into the market. The aim is to provide the same opportunities and protection throughout the EU, she stressed.
And it is thanks to the existence of a European capital market of sufficient size that market “infrastructures”, such as clearing houses, will be set up in the EU, thus minimising the “anomaly” of dependence on infrastructures located in London. In the meantime, the markets need to remain “operational”, she cautioned.
Banks. In the area of banking legislation, the Commissioner-designate has followed the European Commission’s traditional line.
“Should we be the only ones to apply 100% of the so-called ‘Basel III’ prudential standards?” asked Gilles Boyer (Renew Europe, French). “I will not defend a race to the bottom” in terms of regulation for the sake of financial stability, said Ms Albuquerque, while stressing it necessary to guarantee “a level playing field” at international level (see EUROPE 13473/3).
With Donald Trump’s victory, the United States could delay the application of these international banking standards, or even disregard them altogether.
Kira Marie Peter-Hansen (Greens/EFA, Danish) and Costas Mavrides (S&D, Cypriot) questioned Ms Albuquerque on the completion of banking union in the euro area.
“I have been a supporter of a European Deposit Insurance Scheme (EDIS) since the very beginning”, she stressed. Since the approach presented is not working, she said she was prepared to work on “an alternative”, without going into details.
Asked by Irene Tinagli (S&D, Italian) to comment on the forthcoming negotiations between the European Parliament and the EU Council on the ‘CMDI’ package strengthening the management of a banking crisis (see EUROPE 13437/4), she considered that a better solution than the existing one had to be found, as the position of the EU Council was not ideal, in her view. But, once again, without going into detail about the way forward.
Sustainable finance. In this area, Ms Albuquerque placed great emphasis on the implementation of the policies adopted. “These regulatory frameworks are important because they provide certainty for market players and effectively influence the approaches of our international partners”, she said.
In her view, “it is time to reorientate sustainable financing policy to make the framework more usable, particularly for SMEs and those in transition to sustainability, while avoiding greenwashing”.
The candidate also mentioned the simplification of requirements, as announced by the Commission in May 2023 (see EUROPE 13154/16). She therefore wants to make the necessary adjustments to improve implementation. “I think that in the medium and long term, this will be very beneficial for our competitiveness”, she stressed, wanting the EU to remain “a leader in the development of frameworks for sustainable finance”.
Consumers. Finnish MEPs Eero Heinäluoma (S&D) and Maria Ohisalo (Greens/EFA) questioned the candidate on the protection of consumers of financial services.
The latter emphasised the importance of developing products tailored to the level of risk that retail investors wish to take, and of financial education to enable them to make informed choices. As for the question of ‘inducements’, the commissions received by advisers for certain sales of financial products, it ruled that it was not necessary to insist on their prohibition, as the Council of the EU had ruled out this possibility (see EUROPE 13430/14).
Lastly, responding to Damian Boeselager (Greens/EFA, German), the Commissioner-designate said she was prepared to consider impact studies on housing for initiatives falling within her remit. (Original version in French by Mathieu Bion with Anne Damini)