What changed between the draft committee report and the plenary report

MOTION FOR A EUROPEAN PARLIAMENT RESOLUTION

5 unchanged paragraphs

on Banking Union – annual report 2023

(2023/2078(INI))

The European Parliament,

– having regard to its resolution of 11 July 2023 entitled ‘Banking Union – annual report 2022’,

– having regard to the Commission’s follow-up to Parliament’s resolution of 11 July 2023 entitled ‘Banking Union – annual report 2022’,

Added:– having regard to the European Central Bank’s ‘Feedback on the input provided by the European Parliament as part of its resolution on Banking Union 2022’ published on 20 October 2023,

8 unchanged paragraphs

– having regard to the 2022 Annual Report by the European Central Bank (ECB) on supervisory activities of 21 March 2023,

– having regard to the 2022 Annual Report by the Single Resolution Board (SRB) of 30 June 2023,

– having regard to the Commission’s proposal of 24 November 2015 for a Regulation of the European Parliament and of the Council amending Regulation (EU) No 806/2014 in order to establish a European Deposit Insurance Scheme (COM(2015)0586),

– having regard to the Commission’s proposal of 14 March 2018 for a Directive of the European Parliament and of the Council on credit servicers, credit purchasers and the recovery of collateral (AECE) (COM(2018)135),

– having regard to the Council’s press release of 7 December 2022 entitled ‘Anti-money laundering: Council agrees its position on a strengthened rulebook’,

– having regard to the Council’s press release of 27 June 2023 entitled ‘Banking sector: Provisional agreement reached on the implementation of Basel III reforms’,

– having regard to the Commission’s proposal of 18 April 2023 for a Regulation of the European Parliament and of the Council amending Regulation (EU) No 806/2014 as regards early intervention measures, conditions for resolution and funding of resolution action (COM(2023)226),

– having regard to the Commission’s proposal of 18 April 2023 for a Directive of the European Parliament and of the Council amending Directive 2014/59/EU as regards early intervention measures, conditions for resolution and financing of resolution action (COM(2023)227),

Changed:– having regard to the Commission’s proposal of 18 April 2023 for a Directive of the European Parliament and of the Council amending Directive 2014/49/EU as regards the scope of deposit protection, use of deposit guarantee schemes funds, cross-border cooperation, and transparency (COM(2023)228),(COM(2023)0228),

– having regard to the Five Presidents’ Report of 22 June 2015 entitled ‘Completing Europe’s Economic and Monetary Union’,

– having regard to the Eurogroup statement of 16 June 2022 on the future of the Banking Union,

Added:– having regard to the standards of the Basel Committee on Banking Supervision on the prudential treatment of cryptoasset exposures, published on 16 December 2022,

– having regard to the Commission’s communication of 16 December 2020 on tackling non-performing loans in the aftermath of the COVID-19 pandemic (COM(2020)0822),

Added:– having regard to the ECB recommendation of 15 December 2020 on dividend distributions during the COVID-19 pandemic,

Added:– having regard to the ECB Occasional Paper Series ‘The Road to Paris: stress testing the transition towards a net-zero economy’,

– having regard to the outcome of the 2023 EU-wide transparency exercise of the European Banking Authority (EBA), published on 28 July 2023,

Added:– having regard to the EBA report on the role of environmental and social risks in the prudential framework,

– having regard to the ECB document of May 2023 entitled ‘Financial Stability Review’,

Added:– having regard to the ECB’s report of 12 December 2022 on its supervisory priorities for 2023-25,

4 unchanged paragraphs

– having regard to the report of the European Court of Auditors of 12 May 2023 entitled ‘Special report 12/2023: EU supervision of banks’ credit risk – The ECB stepped up its efforts but more is needed to increase assurance that credit risk is properly managed and covered’,

– having regard to the statements by Andrea Enria, Chair of the Supervisory Board of the ECB, at the hearings of Parliament’s Committee on Economic and Monetary Affairs on 21 March 2023 and on 28 June 2023,

– having regard to the statements at the public hearing of the Committee on Economic and Monetary Affairs with the candidate proposed for the Chair of the Supervisory Board of the ECB on 20 September 2023,

– having regard to the statements of Dominique Laboureix, Chair of the SRB, at the hearings of Parliament’s Committee on Economic and Monetary Affairs on 1 March 2023 and on 18 July 2023,

Changed:– having regard to the SRB Bi-annual reporting note to the Eurogroup of 15 May 2023,

– having regard to the joint statement by the ECB Banking Supervision, the EBA and the SRB of 20 March 2023 on the announcement on 19 March 2023 by Swiss authorities,

– having regard to the Memorandum of Understanding dated 27 June 2023 establishing a framework for financial services regulatory cooperation between the European Union and the United Kingdom of Great Britain and Northern Ireland,

– having regard to the declaration of 7 December 2022 signed by the Chair of Parliament’s Committee on Economic and Monetary Affairs and agreed on by the coordinators for six Parliament political groups (European People’s Party, Progressive Alliance of Socialists and Democrats, Renew Europe, Greens/European Free Alliance, European Conservatives and Reformists and The Left) on the European deposit insurance scheme,

Change 1

Added:having regard to its resolution of 25 March 2021 on strengthening the international role of the euro,

– having regard to its resolution of 14 March 2019 on gender balance in EU economic and monetary affairs nominations,

– having regard to Rule 54 of its Rules of Procedure,

Changed:– having regard to the report of the Committee on Economic and Monetary Affairs (A9-0000/2023),(A9-0431/2023),

Change 2

Changed:A. whereas the Banking Union (BU), which currently encompasses the Single Supervisory Mechanism andMechanism, the Single Resolution Mechanism, needsand toa besingle supplementedrule bybook as its foundation, is an integral part of the creationUnion’s financial stability, and guarantees a high minimum standard in the area of deposit protection in the absence of a European deposit insurance scheme (EDIS);

Change 3

Removed:B. whereas a completed BU would improve the competitiveness and stability of the banking sector and consumer choice and facilitate access to financing;

Added:B. whereas addressing the risks arising from the problem of the overly concentrated sovereign-bank nexus would offer crucial additional stability and security for the European banking system and the customers that use it;

Removed:C. whereas EU banks have withstood the impact of Russian aggression; whereas they are key for implementing sanctions against Russia; whereas further coordination is needed to avoid circumvention of sanctions;

Added:C. whereas a fully developed BU would be a positive development for citizens and the EU economy, providing the basis for a more stable banking system, reduction of systemic risk, enhanced competition, improved consumer choice and protection, increased opportunities for cross-border banking and access to retail financial services, greater economic investment, better access to funding for households and businesses, and lower costs for banks’ customers, while ensuring that public funds are not used to bail out the banking sector;

Removed:D. whereas, following calls from Parliament, the Commission proposed a reform of the crisis management and deposit insurance (CMDI) framework;

Added:D. whereas EU banks have withstood the impact of Russian aggression; whereas they play a pivotal role in ensuring the ongoing implementation of and compliance with the sanctions imposed by the EU against Russia in response to the invasion; whereas further coordination is needed to avoid circumvention of sanctions;

Removed:E. whereas fragmentation and the lack of cross-border consolidation of the EU banking sector is affecting its global competitiveness; whereas the profitability gap between EU and US banks has widened;

Added:E. whereas climate change, environmental degradation and the transition to a low-carbon economy are factors to be taken into account when assessing the sustainability of banks’ balance sheets, as a source of risk potentially impacting investments across regions and sectors;

Removed:F. whereas a strong banking sector is key for delivering economic growth, financing small and medium-sized enterprises (SMEs) and start-ups and the transition to a green and digital economy;

Added:F. whereas agreement on an EDIS has not yet been achieved; whereas, following calls from Parliament, the Commission proposed a reform of the crisis management and deposit insurance (CMDI) framework, while recognising that this framework should not be considered as a replacement for an EDIS;

Removed:G. whereas the non-performing loan (NPL) ratio slightly decreased in the first quarter of 2023 despite the pandemic and the Russian aggression against Ukraine;

Added:G. whereas although a political agreement was reached in 2020 on the creation of a backstop to the Single Resolution Fund (SRF), that backstop is still missing; whereas, according to the latest available data, 16 of 36 deposit guarantee schemes in the EU were below their required (minimum) funding level;

Added:H. whereas the lack of cross-border consolidation of the EU banking sector is affecting its global competitiveness and consumer banking in some Member States is still dominated by a small number of banks; whereas the profitability gap between EU and US banks has widened during the last decade and EU banks’ return on equity is 5 points lower than that of US banks’;

Added:I. whereas the EU banking sector has shown rising profitability, partly due to higher interest rates and as a result of increased ECB deposits; whereas the rise in interest rates has also led to a deterioration of the balance sheet of certain banks due to unrealised capital losses;

Added:J. whereas a strong, stable, resilient, dynamic and competitive banking sector is vital for delivering economic growth, for financing small and medium-sized enterprises (SMEs) and start-ups, for increasing the possibility of homeownership, and for the urgent transition to a green and digital economy;

Added:K. whereas the banking sector faces risks following the pandemic and the invasion, particularly in relation to asset quality deterioration; whereas although the non-performing loan (NPL) ratio decreased to 2.24 % in the first quarter of 2023, and has steadily declined since the end of the Great Recession, further reduction is needed;

L. whereas EU legislators negotiated rules to implement Basel III standards in a way that preserves banks’ competitiveness and takes into account the specificities of the EU banking sector;

Change 4

Removed:I. whereas risks stemming from interest rate hikes have been properly addressed;

Added:M. whereas the digitalisation of finance provides important opportunities for the banking sector and has brought about important technological advances in the EU banking sector through increased efficiency in the provision of banking services and a greater appetite for innovation; whereas it also poses challenges, including with regard to data protection, reputational risks, anti-money laundering (AML), and consumer protection concerns;

Added:N. whereas financial institutions rely increasingly on the use of information and communications technology (ICT); whereas the EU banking sector must increase its cyber resilience to ensure that ICT systems can withstand various types of cyber security threats;

Added:O. whereas the level of sovereign exposure has been growing in a number of banks; whereas the risks arising from the problem of the overly concentrated sovereign-bank nexus need to be addressed;