The uncertainty and delay surrounding the European banking union needs to end if lenders are to shake off “the shackles on growth,” the chief financial officer of BNP Paribas told CNBC.
“In terms of regulation risk, there is still a lot of uncertainty and I would argue that what is really important is that they allow banks to focus on implementing the regulation that is already there instead of tweaking proposals,” Lars Machenil told CNBC.
Europe’s shaky banks have been at the heart of the euro zone’s financial crisis of confidence. Governments struggling to keep down their deficits have had to sell more debt to prop up their lenders, which also buy the bonds.
In June 2012, European leaders agreed to set up a European banking union to put an end to this co-dependency. However, European governments have clashed over how far regulation should go – particularly over who should have the final say over rescuing and winding down banks.