The EBF disagrees with the Liikanen report’s recommendation that the mandatory separation of proprietary trading activities would adequately address issues such as systemic risk. Instead, it states that such a move may harm the ability of banks to lend and negatively impact the competitiveness of the European financial sector. However, the EBF does agree that recovery and resolution plans need to be strengthened, suggesting that such measures should be an alternative to the mandatory separation of proprietary trading.
The European Commission’s consultation closed on November 13. Further responses will be published online in due course.