{"id":1100428,"date":"2026-07-20T11:20:21","date_gmt":"2026-07-20T11:20:21","guid":{"rendered":"https:\/\/www.europesays.com\/uk\/1100428\/"},"modified":"2026-07-20T11:20:21","modified_gmt":"2026-07-20T11:20:21","slug":"europe-seeking-balance-in-review-of-capital-rule-ditched-by-us","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/uk\/1100428\/","title":{"rendered":"Europe seeking ‘balance’ in review of capital rule ditched by US"},"content":{"rendered":"

Top official hints at more temporary changes to address the immediate needs of the continent\u2019s economy\u00a0<\/p>\n

Published Mon, Jul 20, 2026 \u00b7 07:16 PM<\/p>\n

[BRUSSELS] The European Union\u2019s (EU) top financial services official has downplayed the prospect of completely axing a contentious bank capital rule slated for review, hinting instead at more temporary changes to address the immediate needs of Europe\u2019s economy.\u00a0<\/p>\n

One of the biggest surprises from the European Commission\u2019s grand plan for tackling banking competitiveness was a commitment to advance \u201cclear proposals\u201d to reform the \u201coutput floor\u201d, a new global rule introduced so banks couldn\u2019t game their models to cut capital charges.\u00a0<\/p>\n

The US announced in March that it will not implement the output floor when it finally adopts the rules agreed in Basel almost a decade ago, while the EU had promised to introduce it on a phased basis despite protests from its banks.\u00a0<\/p>\n

In an interview after unveiling Friday\u2019s (Jul 17) report, financial services commissioner Maria Luis Albuquerque said that the output floor is particularly onerous for European lenders because so many of the region\u2019s businesses don\u2019t have credit ratings and rely on bank financing.\u00a0<\/p>\n

Europe is trying to \u201cincentivise\u201d companies to reduce their dependence on bank lending, Albuquerque noted. The work on the output floor will seek to \u201cbalance the short-term needs\u201d of Europe\u2019s economy, which are hurt by the output floor, \u201cwith a more strategic perspective\u201d toward reducing bank funding.<\/p>\n

The European Central Bank\u2019s supervisory arm, which oversees eurozone lenders, supports the output floor and Albuquerque said that officials would \u201cneed to have a proper dialogue with them\u201d on the topic, as well as with those at the Basel Committee on Banking Supervision that set the rules. \u00a0<\/p>\n

The Center for European Policy Studies think tank had urged Europe against weakening the measure, arguing that it would \u201cforfeit the EU\u2019s standing to demand faithful implementation from others\u201d on globally agreed rules.\u00a0<\/p>\n

\u201cIt\u2019s not Europe is doing something and everybody else is faithfully implementing Basel,\u201d Albuquerque said on whether tweaking the rules could compromise Europe\u2019s standing globally. \u201cI would not focus too much on the element of how good we look.\u201d\u00a0<\/p>\n

She also hinted that the door remains open for other reforms not mentioned in Friday\u2019s package, as Europe works toward concrete legislative proposals by the end of the first quarter.\u00a0\u201cSome are not mentioned which doesn\u2019t mean that they are not important or that we will not take them into account,\u201d she added.\u00a0<\/p>\n

SEE ALSO<\/p>\n

\"The<\/a><\/p>\n

Albuquerque pointed out that Europe\u2019s parliament and council would decide whether to sequence the various proposals, but that her preference was that they be done together, since they are inter-connected.\u00a0<\/p>\n

An obvious concern is that progress on the most contentious topic, Europe\u2019s deposits scheme, could prove impossible and thus put the whole effort in jeopardy.\u00a0\u201cThat\u2019s something that we will explain to the co-legislators,\u201d she said, adding that she disagrees with \u201cthe idea that there is something, some challenge, we cannot overcome\u201d. BLOOMBERG<\/p>\n","protected":false},"excerpt":{"rendered":"Top official hints at more temporary changes to address the immediate needs of the continent\u2019s economy\u00a0 Published Mon,…\n","protected":false},"author":2,"featured_media":1100429,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_share_on_mastodon":"0"},"categories":[5174],"tags":[3427,2000,299,5187,2557,1699],"class_list":["post-1100428","post","type-post","status-publish","format-standard","has-post-thumbnail","category-eu","tag-banking","tag-eu","tag-europe","tag-european","tag-european-commission","tag-european-union"],"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/116952043398303402","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/1100428","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=1100428"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/1100428\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/1100429"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=1100428"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=1100428"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=1100428"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}