Albuquerque pledges to defend EU bank rules hours before Basel chief's reprimand against rollbacks

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While her fellow Commissioner-designate Valdis Dombrovskis doubled down on the “simplify regulation, boost business competitiveness” discourse in his preliminary answers to MEPs on Tuesday (22 October), those who were expecting a similarly pro-business posturing from Maria Luís Albuquerque can think again.

Since her nomination for the post of Financial Services Commissioner in September, attention, among sector stakeholders, has focused mainly on the Portuguese candidate’s private sector background – most notably, her recent director roles at US investment giant Morgan Stanley and London-based fund manager Arrow Global.

But it was a different perspective that emerged from her answers to MEPs ahead of her 6 November hearings: one more in line with the government role she held ten years ago as minister of finance under the thorny austerity years of Pedro Passos Coelho’s centre-right tenure.

Showcasing an enduring loyalty to the landmark global prudential framework that was set up under the guidance of the Basel Committee on Banking Supervision in the post-crisis era, Albuquerque signalled on Tuesday that, if confirmed commissioner, she will steadfastly pursue the full application of the so-called 'Basel 3 Endgame'.

The framework, addressing some key outstanding elements of the international banking capital requirement legislation, such as how banks calculate how much capital they need to set aside for their trading books’ exposures, was originally supposed to come into force in January 2025. However, it has been delayed by a minimum of one year after staunch industry opposition in the US prompted the EU to also postpone it and the UK to mull a watered-down version of the rules.

Albuquerque, however, was adamant Europe should take the high road.

“Let me be very clear: we must implement the rules, not roll back,” she told MEPs on Tuesday.

“We must also be mindful of [...] the possible consequences of delays and divergences in the implementation of standards by other important jurisdictions. If confirmed as Commissioner, I will encourage our international partners to implement the agreed Basel reforms as soon as possible to ensure a level playing field,” she said.

She also emphasised that “the EU’s policy line is to apply the [Basel reforms] to all EU 4500 banks, and not just to the large internationally active ones, as is the case in other jurisdictions.”

Notably, her strong posturing on the banking framework came as an omen of yet stronger admonition from the head of the Basel Committee himself, Erik Thedéen, just 24 hours later.

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