The European Parliament has passed a resolution setting out the Parliament's priorities for a broad overhaul of EU banks. The resolution stresses the need for more competition in the banking sector and for further reform of banks' remuneration and corporate governance structures. The Resolution identifies core principles for structural reform including:
- reducing excessive risks, ensuring competition, reducing complexity and limiting interconnectedness in EU banks by separating banking activities that are essential for the real economy from risky trading and investment ones;
- improving corporate governance and creating incentives for banks to establish transparent organisational structures, increasing accountability and re-enforcing a responsible and sustainable remuneration system;
- strengthening personal liability and liability of the board members;
- ensuring that essential retail activities continue uninterrupted by problems caused by the investment arm of a bank.