To get Europe back on track towards long-term sustainable growth is a key goal in which the financial services industry has a vital role to play. The banking sector, institutional investor and capital markets all have an important contribution to make in channeling savings into long-term investments. Reinforced prudential rules for different market players may hamper their ability to channel funds into long-term investments, which in general are riskier and less liquid. At the same time, if not designed correctly third country rules may reduce the access to funding from international investors.
How can we at the same time achieve financial stability and long-term growth? How can we achieve a regulatory environment that creates the best conditions for the financial industry to channel funds for long-term investments?
08.30 – 09.00 Welcome coffee & mingle
09.00 – 09.05 Welcome speech
09.05 – 09.15 Moderator’s opening remarks
09.15 – 10.55 Panel 1: How can the banking sector contribute to long-term growth?
In the EU, bank lending has traditionally been the main source of funding for SMEs. Those are however risky and illiquid assets, which banks will need to reduce in order to meet the new capital requirements.
Possible discussion points
- How could we find a way to encourage long-term investments while at the same time introduce adequate prudential requirements? In this context, are the regulatory measures taken so far appropriate?
- While market based funding may play an increasingly important role in the future, there will still be a need for the local knowledge and ability to assess risk that retail banks posses. How can we create the best conditions for the banking industry to fill this important role? How can the banking sector’s capacity to channel funds for long-term investments be enhanced?
- Would a reform of the structure of the EU banking sector as suggested by the Likkanen group make it easier or more difficult for the banking sector to channel financing to long-term investments?
Othmar Karas Vice President, European Parliament
Erik Van Der Plaats Policy Co-ordinator, Unit H1- Banks and Financial Institutions, DG MARKT, European Commission
Vytautas Valvonis Executive Director Supervision Service, Bank of Lithuania
Karel Van Eetvelt Managing Director, UNIZO – Belgian organisation for self-employed entrepreneurs
Benot Sauvage Senior Adviser, Financial Market Regulation, ABBL – Luxembourg Bankers’ Association
Moderator: Prof Charles Goodhart Emeritus Professor, London School of Economics
11.15 – 13.00 Panel 2: Long-term investments – what role can institutional investors play in channeling long-term financing?
Institutional investors have in general a relatively long time horizon. The long duration of their liabilities make it possible to make long-term investments. New prudential rules may, however, make this more difficult as they require a larger proportion of liquid and less risky assets in the portfolio.
Possible discussion points
- How could the calibration of capital requirements under Solvency II be adjusted to avoid obstacles to long-term financing?
- What role could the new ELTIF vehicle (European Long-Term Investment Fund) play?
- How could the private equity and venture capital sector best contribute to SME funding? Are there obstacles in this regard in prudential regulation and, if so, how could they be overcome?
Philippe De Backer Member of the European Parliament
Mark Hutchinson Head of Alternative Credit, M&G Investments
Timothy Shakesby Policy Analyst, Unit G4 – Asset Management, DG MARKT, European Commission
Prof Dr Michael Schrder MHead of Department International Finance and Financial Management, ZEW and Professor of Asset Management, Frankfurt School of Finance & Management
Franois Passant Executive Director, Eurosif- European Sustainable Investment Forum
13.00 – 14.00 Networking lunch
14.00 – 14.10 Moderator’s opening remarks
14.10 – 16.00 Panel 3: Taking the global perspective
Europe is part of a global economy. Funding from third countries may play an important role in funding Europe’s need for financing long-term growth. However, the responses to the financial crisis have created divergence between jurisdictions.
Possible discussion points:
- How can we make sure that the regulatory changes create the right conditions in order to attract foreign investments to Europe?
- Are the rules adequate in order to give European investors access to the global markets?
- Is mutual recognition a realistic way forward?
- How can the collaboration with foreign regulators be improved? What role can international bodies play?
- Can an omnibus directive be the right way to achieve harmonised third country rules or will it create additional complexity?
Peter Skinner Member of the European Parliament
Olivier Guersent Head of Cabinet of Commissioner Michel Barnier, DG MARKT, European Commission
Andrew Douglas Managing Director, Government relations, Europe and Asia, DTCC
Franoise Buisson Director for European and International Affairs, AMF France – Autorit des Marchs Financiers
Roel Campos Partner, Head of Securities Regulation and Enforcement, Locke Lord LLP
Moderator: Anthony Belchambers Chief Executive FOA – Futures and Options Association
16.00 – 16.20 Refreshments
16.20 – 18.00 Panel 4: How can securities Markets fund long-term growth?
Market based financing for SMEs has traditionally been less developed in Europe compared to the United States. As banks find it increasingly difficult to provide funding to SMEs, the capital markets may have an important role to play.
Possible discussion points
- How could securitisation help provide funding for long-term investments?
- Is there a need for a more harmonised framework for covered bonds?
- Stable and well functioning capital markets is absolutely vital, not only for the financial industry itself but for the whole economy and hence a prerequisite for economic growth. Will measures taken so far (MiFID II, EMIR, SLD) create the right conditions for well-functioning capital markets?
- What role could a European project bond market play?
- How could we channel more funds towards equity?
- How could the EU encourage SME listings? Are the current rules such as the prospectus directive and the transparency directive too burdensome for SMEs? What relaxations or exemptions could be made to lower the thresholds for SMEs to become listed?
Markus Ferber Member of the European Parliament
Patrick Pearson Head of unit G2 – Financial Markets Infrastructure, DG MARKT, European Commission
Per Lovén Head of EMEA Corporate Strategy & Product, Liquidnet
Dr Diego Rodríguez Palenzuela Head of Capital Markets & Financial Structure Division, ECB