Economic news Embassy 42
EU banking union under the spotlight
The UK’s financial services sector has given a cautious welcome to recent moves to create a eurozone banking union but remains concerned about the fragmentation of the single market, a City expert told economic attachés at a recent AERL business breakfast.
Speaking ahead of a summit in Brussels, Howard Miller from TheCityUK told attachés that although the UK would be outside the banking union, the financial services sector was in favour of regulatory reforms, provided they “restored confidence, certainty and predictability” to the financial system and did not interfere with the working of the single market.
“We do not want a banking union in the eurozone area to create a two-tier single market,” warned Miller. He added that there needed to be “fairness built into the voting structures” within the European Banking Authority to ensure that the eurozone block did not dominate non-eurozone member states when drafting financial rules.
To avert the risk of this happening, Mr Miller said it was vital that the UK remained “fully engaged” in the negotiations.
He added there were question marks over how the new supervisory authority would affect the independence and accountability of the European Central Bank.