29 April 2022
The European Banking Authority (EBA) published today its response to the European Commission’s Call for Advice on the review of the macroprudential framework, proposing a set of recommendations to simplify the procedures around some of the existing macroprudential tools and to increase harmonisation for others.
The EU banking system proved resilient during the COVID pandemic and banks continued to provide credit to the real economy. This was partly due to the extraordinary fiscal, monetary and prudential measures, that were put in place and that included a release of macroprudential buffers. The lessons learnt since the inception of the macroprudential framework, including those gained during the COVID pandemic highlighted the need for some targeted changes to make the macroprudential framework more effective and to improve the functioning of the Single Market.
The EBA’s advice includes the following recommendations:
Article 513 of the CRR requires the European Commission to complete a review of the macroprudential provisions in the CRR and CRD by June 2022 and, if appropriate, to submit a legislative proposal to the European Parliament and to the Council by December 2022.
As part of this review, in June 2021, the European Commission issued a request to the EBA, ESRB and ECB for advice on four aspects, namely: (1) the overall design and functioning of the buffer framework, (2) missing or obsolete instruments, (3) internal market considerations and (4) global risks.
Franca Rosa Congiu