European Commission consultation

The German Banking Industry Committee took part in the targeted consultation assessing the adequacy of macroprudential policies for non-bank financial intermediation (NBFI) with a comment. The comment was limited to selected aspects of the consultation documents, specifically those that focus on interactions between the banking and non-banking industries. The European Commission reserves the right to make a legislative proposal based on their consultation. This legislative proposal would further develop the macroprudential framework for both banks and NBFI. We at the German Banking Industry Committee firmly believe that the European Commission should set macroprudential regulation standards based on the principle of “same business, same risk, same rules.” This will ensure a level playing field for financial market transactions. Legislators should make sure that the capital requirements for both sectors are balanced proportionately and that bureaucratic burdens are reduced to a more appropriate level.

In our opinion, the interplay between banks and NBFIs spreads risks and thus has an overall positive effect on financial stability. However, it simply cannot be the case that financial transactions from the growing NBFI sector are hedged by banks, so that regulations for banks are tightened even further. We keep an eye on dominant geopolitical risks in our interactions with the NBFI sector. Disclosure requirements mean that the banking industry reliably and regularly informs the public regarding their financial situation and risk position.