European Central Bank calls for deeper integration to simplify banking

by@ecb

Summary

Sharon Donnery, a member of the Supervisory Board of the European Central Bank, argues that greater integration is essential for addressing the complexities facing the European banking sector. Despite improvements in capitalization and profitability, European banks struggle with fragmentation caused by national regulations, which hinder their ability to compete globally. Donnery emphasizes that a truly single rulebook and the completion of the Banking Union, including a European deposit insurance scheme, are critical for enabling cross-border capital movement and reducing bureaucratic complexities. These measures would not only streamline operations for larger banks but also foster a more integrated and competitive European financial market.

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Analysis

Sharon Donnery: Sharon Donnery serves as a Member of the Supervisory Board of the European Central Bank, focusing on banking supervision and regulatory issues. She authored this contribution for Eurofi Magazine on 16 September 2026, making the case that completing the banking union and creating a truly single rulebook would reduce duplication and allow European banks to compete more effectively with global peers. European Central Bank: The European Central Bank is the central bank of the euro area responsible for monetary policy and prudential supervision of banks through its Single Supervisory Mechanism. In this news, its Supervisory Board member Sharon Donnery argues that fragmentation across national borders remains the root cause of complexity in European banking and that deeper integration offers the best path to simplification and scale. Rulebook Harmonization: A shift from directives to directly applicable regulations, combined with a review of options and discretions, would reduce national divergences that currently force banks to maintain parallel structures. Banking Union Completion: A European deposit insurance scheme with a clear timetable would build the trust needed for cross-border capital and liquidity waivers within banking groups.

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macropolitics
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