The European Commission has today adopted a banking package to help facilitate bank lending to households and businesses throughout the European Union. The aim of this package is to ensure that banks can continue to lend money to support the economy and help mitigate the significant economic impact of the Coronavirus. It includes an Interpretative Communication on the EU’s accounting and prudential frameworks, as well as targeted “quick fix” amendments to EU banking rules.
This banking package will allow banks and their supervisors to act in a flexible, but responsible, manner during economic crises to support citizens and firms, particularly SMEs. In addition, the package also implements some targeted changes to maximise the capacity of credit institutions to lend and to absorb losses related to the Coronavirus pandemic, while still ensuring their continued resilience.
The Commission will engage with the European financial sector to explore how it can develop best practices that could further support citizens and businesses. The EU’s response to this crisis must be coordinated in order to avoid national fragmentation and to ensure a level playing field.
The Commission proposes exceptional temporary measures to alleviate the immediate impact of Coronavirus-related developments. This is done by adapting the timeline of the application of international accounting standards on banks’ capital, by treating more favourably public guarantees granted during this crisis, by postponing the date of application of the leverage ratio buffer and by modifying the way of excluding certain exposures from the calculation of the leverage ratio.