(Bloomberg) — The EU could consider moving forward with a “coalition of the willing” and not wait for all 27 members to agree on a capital markets union as it tries to break a deadlock in its decade-old plan and finance a nearly trillion-euro investment gap, the bloc’s financial services chief said.
Most Read from Bloomberg
-
Texas HOA Charged With Discrimination for Banning Section 8 Renters
-
NYC Subway’s Most Dangerous Stations Are on Lexington Ave. Line
-
Newsom Enlists Magic Johnson, Guggenheim CEO for LA Rebuilding
In her first interview as commissioner for financial services, Maria Luis Albuquerque said it’s preferable to have all member states join the initiative, but she is open to alternatives on issues where agreement is elusive.
“What I’m saying is that there can be associations of different member states,” she said. “They can group and promote this and find the best solutions. But the point is, will we be waiting for every single one to develop their own capital markets? It hasn’t happened.”
Her comments mark a significant departure from the path the EU has trodden for the last decade, as it sought full agreement on efforts to lower national barriers and create vibrant capital markets offering funding to companies and returns to savers across the EU.
Progress has been slow, as member states clashed over issues like single supervision or taxation, even while politicians warned that the demands of the green transition made the project more pressing. A series of reports last year gave the project fresh impetus, including one from former European Central Bank President Mario Draghi, who warned that the EU itself was at risk without more funding.
Finance firms, meanwhile, have intensified their push for reforms like loosening the rules around securitizations, measures that could boost bank lending and generate healthy fees and commissions for arrangers of deals.
“We currently have about €11 trillion in bank accounts,” Albuquerque said of the potential prize for Europe. “Even if a small part of that amount can be put to work into capital markets, namely on equity, this makes a huge difference for the ability of our corporates to get the equity they need.”
A “coalition of the willing” could work on areas like how to grow Europe’s retail investment market or aligning tax treatments for cross-border investments. “I don’t want to preempt such discussions,” she added. “What I am saying is we can look at these types of solutions.”
