Eurofi held its Financial Forum in Budapest from 11 to 13 September. The event took place at a crucial time, with the European Union in the midst of institutional renewal, and Mario Draghi’s recent report on European competitiveness fuelling discussions about the impacts on the roadmap of the new Commission (see Editorial).
AMAFI’s meetings focused on its proposals (AMAFI / 23-88) for the Capital Markets Union, which the Letta Report has suggested rebranding as a Savings and Investment Union, and drew attention to the challenges involved in switching to T+1 settlement.
AMAFI Chairman Stéphane Giordano, Director of European and International Affairs Arnaud Eard, and several members of the European Action Committee met with institutional representatives, including Stéphanie Yon-Courtin, member of the European Parliament’s Committee on Economic and Monetary Affairs, Martin Merlin, Financial Markets Director at DG FISMA, as well as finance ministry representatives from ten member states.
AMAFI’s proposals for the Savings and Investment Union (AMAFI / 24-56) were broadly welcomed, especially those aimed at nurturing less developed local markets. There was also general agreement about reviving Europe’s securitisation market and channelling household savings to finance the European economy through tax incentives and a European label. By contrast, proposals on reforming the governance of ESMA and shifting towards more centralised supervision for cross-border activities received more muted support. Those reactions raised questions about the political will needed to carry out structural reforms in order to build deep and competitive capital markets.
On shortening the settlement cycle (AMAFI / 24-57), it is now apparent that Europe is set to follow the lead of the United States and several other countries that recently moved to T+1. AMAFI’s talking partners seemed receptive to the argument that the work areas needed to support a successful move should be identified before setting a date for the switchover. The unique infrastructure and liquidity features of Europe’s markets must be accommodated to ensure that these markets stay efficient and competitive. These issues should likewise be foremost when organising the vital coordination with UK and Swiss authorities
