The Commission has published the responses it received to its consultation on the recommendations of the high level group on banking structure reform (the Liikanen Group). It has also published a summary of these responses. Key themes included:

  • arguments from banks that there was not enough evidence to back the recommendations for separating certain banking activities, combined with a view that the current reform agenda addresses the issues the recommendations seek to fix. Other respondents had mixed views on structural separation, citing costs implications and calling for more clarity on the proposals;
  • most respondents supported stronger recovery and resolution plans (RRPs) and some banks argued there was no need for structural separation if these were in place;
  • of the respondents who expressed a view on the bail-in recommendations, there were mixed views on whether bail-in should be targeted to clearly designated instruments, but broad agreement that it would be too restrictive to prohibit other banks from holding the instruments; and
  • general opposition from banks to the proposal to revise capital charges for the trading book, by setting an extra capital buffer or introducing a minimum floor to risk-based requirements. They said existing changes to the Capital Requirements Directive should be enough.

(Source: Commission Publishes Liikanen Replies)