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MNI BRIEF: ESM Aim At Bank Lending Boost During Slowdowns

(MNI) LONDON
(MNI) Brussels

ESM Chief Economist Rolf Strauch on Friday set out ways to better boost the risk appetite of euro zone banks during economic slowdowns, drawing several lessons from the Covid lockdowns. In a blog on the ESM website, Strauch notes that banks did not respond to reduced capital requirements during the pandemic by significantly increasing their lending

Strauch recommends that policy measures in future crises be more coordinated by regulatory authorities in order to better align market expectations. He also urges a further strengthening of bank profitability via consolidation of the sector and calls for the completion of the EU Banking Union. He goes on to argue for a “deep dialogue” among regulators to avoid situations where regulatory actions to boost lending are misaligned.

MNI London Bureau | +44 203-865-3812 | les.commons@marketnews.com
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MNI London Bureau | +44 203-865-3812 | les.commons@marketnews.com
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