French Central Bank Calls for More Cross-Border Mergers
The Banque de France wants it to be easier for European banks to merge, the central bank's chief Francois Villeroy de Galhau said on Wednesday.
"We have to stop putting the brakes on the cross-border consolidation among eurozone banks," Villeroy de Galhau told a banking supervisory conference.
"Healthy and solid cross-border consolidation enables banks to better diversify their risks in the whole of the euro area and to target more efficiently savings to productive investment," he said.
"A cross-border merger need not be more difficult or complicated than a domestic merger," he continued, calling for existing hurdles to such tie-ups to be lifted.
He proposed that the European Banking Authority, which will relocate from London to Paris once Britain has left the EU, undertake a comprehensive survey of all of the current barriers to cross-border activities and mergers.
"We're still considerably lagging behind the US market," where the five biggest banks command a market share of more than 40 percent, compared with less than 20 percent for the eurozone's top five, Villeroy de Galhau said.
In recent months, banking tie-ups have tended to be domestic and involved ailing lenders, such as the takeover of Banco Popular by Santander in Spain.
Takeover rumours have been swirling for months now around Germany's second-biggest lender, Commerzbank, with French rivals such as BNP Paribas and Credit Agricole or Italy's UniCredit mooted as possible buyers.
Earlier this month, the eurozone's top bank supervisor, Daniele Nouy, also urged the sector to press ahead with cross-border mergers, arguing tie-ups would help forge a stronger European finance industry.
Source: Agence France Presse
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