Brussels: The European Central Bank (ECB) has established a dedicated task force aimed at exploring ways to simplify Europe’s banking regulations, according to a source familiar with the matter who spoke to Reuters.
Chaired by ECB Vice President Luis de Guindos, the newly formed group includes central bank governors from Germany, France, Italy, and Finland, the source said. The move signals a broader effort within the eurozone to assess and potentially streamline regulatory frameworks that some officials have deemed excessively complicated.
The ECB declined to comment on the initiative, while Germany’s Bundesbank, the Bank of France, the Bank of Italy, and the Bank of Finland did not immediately respond to Reuters’ requests for comment.
It is important to note that the ECB does not have the authority to alter banking regulations directly, as this responsibility falls to European lawmakers in Brussels. Any recommendations arising from the task force’s work would need to be forwarded to the European Commission for consideration.
Bloomberg previously reported on the formation of the task force.
The initiative follows a letter sent earlier this year by the central bank governors of Germany, France, Italy, and Spain to the European Commission, advocating for the simplification of European banking rules where they are “unduly complex”.
“A comprehensive analysis of the implications of all the standards produced in Europe should be carried out … to ensure that they do not cumulatively add unintended layers of rules and expectations,” the four governors wrote in their letter addressed to Commissioner Maria Luis Albuquerque.
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They further stated that such a review could lead to “a legislative proposal … with concrete and realistic simplification measures.”
Despite calls for simplification, some within the ECB continue to defend the existing regulatory structure. ECB Chief Supervisor Claudia Buch underscored the importance of maintaining detailed regulations during an event in Washington this week.
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“It is sometimes argued that banking rules are too complex,” Buch said. “But … for regulation to effectively address the industry’s specific needs and vulnerabilities, it must be sufficiently detailed.”
Meanwhile, ECB Governing Council member Fabio Panetta echoed concerns about overregulation in comments made in February, emphasizing that Europe must guard against excessive regulatory burdens and consider simplifying existing rules.
