Eleven major European banks, including Banco Santander, BNP Paribas, Barclays, UBS, Deutsche Bank, and HSBC, sent a joint letter to EU officials on September 10–11. The executives requested a pause on new capital requirements and the implementation of two legislative packages by early 2027.
The proposed reforms include a simplification package to remove redundant rules and a market integration package to facilitate cross-border financing. Banks argue that these changes are necessary to support small and medium-sized enterprises and strategic sectors like defense, energy, and technology.
European lenders currently hold €2,5 trillion in loss-absorbing capacity. Executives suggest that halting additional capital requirements would allow these funds to be directed toward lending and investment, addressing the continent's annual investment gap of €1,2 to €1,4 trillion.
The banking sector has been advocating for regulatory relief since February 2026, citing concerns over losing competitiveness to the US and China. While the European Commission issued a communication on banking competitiveness in July 2026, bank leaders remain concerned about the slow pace of reform.
