Capital Markets Union must be complementary to bank loans
BRUSSELS, 1 April 2019
The following is an excerpt from the recently released brochure 'Together for a growing and more integrated europe: Savings and retail banks’ drive to help Europeans prosper'.
Europe faces financially, economically and socially challenging times. Given this backdrop, nourishing growth and jobs in Europe comes from targeted funding for SMEs and microenterprises. In fact, 75% of European SMEs prefer loans by credit institutions like savings and retail banks as the primary source for external funding. Finding the best way to finance the real economy – and specially SMEs – remains a priority for Europeans and EU policymakers alike.
This is where savings and retail banks in Europe can help. Backed by their long-standing experience in the regions, their wide network and proximity to the local companies enables them to build an irreplaceable knowledge and trustworthy relationships.
It also puts savings and retail banks in an ideally placed position to help empower the economy and boost sustainable, inclusive and smart growth by granting loans to SMEs. Stimulating bank lending to SMEs and avoiding unnecessary regulatory obstacles should be a policy priority.
On the Capital Markets Union, ESBG and its members see a need for financing from capital markets and supports the EU project. CMU is a supplementary vehicle, however, not a primary path to support SME financing. Capital markets can complement, but not replace, the role of bank lending, which remains in high demand amongst SMEs due to its non-complex nature. Substituting bank lending for capital markets works against the demands of SME financing needs. A policy of complementarity remains the best way forward to create a stronger and more competitive European Union.
To learn more about the latest public policy positions on banking from ESBG, see the brochure
Together for a growing and more integrated europe: Savings and retail banks’ drive to help Europeans prosper
>> Read the booklet | En français
>> Learn more: ESBG position on SME financing