Germany’s 2020 EU Council Presidency: Full plate for Merkel

On Wednesday, 1 July, Germany takes up the presidency of the Council of the European Union. This means that, from July to December 2020, Germany will chair the meetings of the EU Council and will be responsible for progressing EU legislation. The German Presidency occurs once every 13 years, and this time its goals include a greener economy, enhancing digitalization, dealing with the Covid-19 crisis, reforming migration and re-engaging the EU with the UK and China. Merkel's Presidency seems all set for a series of crises management manoeuvres to protect the EU health, economy, and integrity. The German Chancellor has already written to the leaders of all parties in the European parliament. She will work closely with Portugal and Slovenia, who will follow Germany’s presidency of the EU and are collectively called the Trio. Germany’s success will be measured by its ability to meet the EUs growing expectations. If it succeeds, it will be a big win for Merkel in her last year as Chancellor. If it fails, then the 'European Project' itself could be in jeopardy. Germany’s 2020 EU Council Presidency website 

FROM THE MEDIA today

CNBC: Fed puts restrictions on bank dividends after stress test

The Federal Reserve put new restrictions on the U.S. banking industry Thursday after its annual stress test found that several banks could get uncomfortably close to minimum capital levels in scenarios tied to the coronavirus pandemic, writes CNBC. Read more MarketWatch NYT(€) FED
 

Reuters: ECB defends bond buys hitting back at German court

European Central Bank policymakers, fending off a German court challenge to their money-printing scheme, insist that bond buys help prop up the economy and their benefits outweigh the side effects, writes Reuters based on the official minutes of the ECB meeting on 4 June. Read more
 

FT: Brussels probes German regulator over Wirecard

The EU has called for a probe into whether BaFin, Germany’s banking regulator, failed in its supervision of Wirecard, writes the FT. Bloomberg confirms that the European Commission has asked ESMA to investigate the events leading to the collapse of the payments company, as well as the supervisory response. The Commission asked for the initial analysis to be concluded by 15 July. Deutsche Welle reports that Wirecard's auditors have accused it of committing an "elaborate and sophisticated fraud." The German payments provider has filed for insolvency and its CEO has been arrested. Read more (€) Bloomberg Deutsche Welle Reuters FAZ (DE)
 

Euractiv: Calviño, Donohoe and Gramegna compete for Eurogroup helm

Ministers Nadia Calviño (Spain), Paschal Donohoe (Ireland) and Pierre Gramegna (Luxembourg) will compete for the Eurogroup presidency, says Euractiv. The election of the successor to the outgoing president, Portuguese Finance minister Mario Centeno, will take place on 9 July. The president’s role during the 2.5 year mandate is to set the agenda for the monthly meetings of the 19 eurozone finance ministers and try to find compromise solutions for divisive issues. Read more
 

The Guardian: EU Parliament leader signals UK attitude in trade talks

Boris Johnson appeared unwilling to compromise in order to secure a trade and security deal with Brussels when he joined EU leaders for a summit last week, according to David Sassoli, president of the European Parliament, reports The Guardian. Read more

FROM THE INSTITUTIONS this week

Federal Reserve Board releases results of stress tests for 2020

The Federal Reserve Board on Thursday released the results of its stress tests for 2020 and additional sensitivity analyses that the Board conducted in light of the coronavirus event. "The banking system has been a source of strength during this crisis," Vice Chair Randal K. Quarles said, "and the results of our sensitivity analyses show that our banks can remain strong in the face of even the harshest shocks." Read more

ECB: Account of the June monetary policy meeting

Expanding the PEPP and extending its horizon was the most effective course of action, according to the account of the monetary policy meeting of the Governing Council of the European Central Bank held on the 3-4 June. The programme supports favourable funding costs and offers temporary support in response to the pandemic shock to the economy and the path of inflation. Read more
 

OECD/INFE 2020 International Survey of Adult Financial Literacy

The OECD/INFE published the results of the 2020 International Survey of Adult Financial Literacy. Twenty-six countries and economies, including 12 OECD Member countries, participated in this international survey of financial literacy, using the 2018 OECD/INFE toolkit to collect cross-comparable data. The survey results report the overall financial literacy scores, as computed following the OECD/INFE methodology and definition, and their elements of knowledge, behaviour, and attitudes. Read more

ECB: New Eurosystem repo facility for central banks

In response to the coronavirus (Covid-19) crisis, the Governing Council of the European Central Bank (ECB) decided to set up a new backstop facility, called the Eurosystem repo facility for central banks (EUREP), to provide precautionary euro repo lines to central banks outside the euro area. EUREP addresses possible euro liquidity needs in case of market dysfunction resulting from the Covid-19 shock that might adversely impact the smooth transmission of ECB monetary policy. Read more

BIS: Central banks and payments in the digital era

While the private sector has the innovation, ingenuity and creativity to serve customers better, central banks play a pivotal role in maintaining the safety and integrity of the payment system and the stability of money writes the Bank for International Settlements (BIS) in its Annual Economic Report. Read more  

Green Deal: key to a climate-neutral and sustainable EU

Parliament wants the Green Deal to be at the core of the EU’s Covid-19 recovery package. Find out more about this roadmap for a climate-neutral Europe. During the coronavirus pandemic, economic activity slowed, causing a reduction in carbon emissions but leaving the EU facing recession. In a resolution adopted on 15 May 2020, Parliament called for an ambitious recovery plan with the Green Deal at its core. Read more

EBF Cloud Banking Forum released three technical papers

Cloud computing is more than just storage but enables banks to develop and deploy future-proof digital services. The EBF Cloud Banking Forum has released three technical papers providing legal and technical intelligence to National Competent Authorities of EU member states.
 

Read the papers HERE

FROM THE MEMBERS this week

France: Sustainable and skilled jobs in the banking sector

With 44,000 new hires and 360,000 people working in banks that are members of the French Banking Federation (FBF) in 2019, i.e. 1.8% of private salaried employment in France, the French banking industry is a dynamic player in the labour market. Thanks to the quality of social dialogue and numerous initiatives, the FBF's member banks are positioned as a leading employer, with 191,600 employees. Read more (FR)

Germany: Better safe than sorry: An attorney for banking transactions

The Association of German Banks published an article underlining the importance of having an attorney in the event that you are no longer able to take care of your own banking affairs due to an accident or serious illness. In this case, it is advisable to provide a person of your trust with an "account/deposit power of attorney - precautionary power of attorney" as a precautionary measure, so that this person can act on your behalf in an emergency. Read more (DE)

The Netherlands: An EU approach to money laundering to turn the tide

There is a growing consensus that the current global framework for fighting financial crime is not as effective as it could be, and that more needs to be done at the international, regional and national levels to help identify and stem the flow of illicit finance. The Dutch Banking Association published in the Bank | Wereld magazine, an interview with Wim Mijs, Chief Executive Officer of the European Banking Federation, on the need to reduce regulatory fragmentation and promote data exchange. Read More (NL)

Belgium: Bank customers are victims of the telephone banking scams

Febelfin shares concerns over telephone banking frauds, which is where a scammer tries to log in to a customer's account over the phone in a bid to transfer money out. Fraudsters are extremely inventive and are constantly looking for new ways to deceive their victims. Whereas in the past, their method often consisted of sending messages to their victims to try to retrieve their personal banking codes (the famous "phishing" technique), they now seem to be widening their hunting ground. Read more (FR)

Spain: The fate of the Spanish economy decided abroad

The president of the Spanish Banking Association warned of the "unquestionable" need to maintain market confidence in the Spanish economy, given that the current volume of foreign debt, equivalent to 170% of GDP, must be financed, plus the new needs that arise from the Covid-19 crisis. "The Spanish economy's future is at stake in the foreign sector", said José María Roldán in a meeting with company representatives from the CEOE's International Relations Committee. Read more (ES)

FROM THE EUROPEAN BANKING FEDERATION this week

The European Banking Federation and fTLD Registry Services (fTLD) are partnering to educate the European banking sector about the cybersecurity role .BANK plays in protecting banks against Business Email Compromise (BEC) scams, phishing and spoofing attacks that lead to breaches, identity theft and financial fraud. fTLD administers the .BANK domain and the EBF has served on its Advisory Council since 2013. To learn more about the security benefits of .BANK, visit https://www.register.bank/ebf/ or contact fTLD at EBF@fTLD.com.

ABOUT THE EUROPEAN BANKING FEDERATION
 

The European Banking Federation is the voice of the European banking sector, bringing together national banking associations. The EBF is committed to a thriving European economy that is underpinned by a stable, secure and inclusive financial ecosystem, and to a flourishing society where financing is available to fund the dreams of citizens, businesses and innovators everywhere.