It is very difficult for banks to raise fresh capital and this can stand in the way of the urgently needed further consolidation in the sector. Moreover, prolonged low profitability can erode the banks’ capital base. We are fully aware of that. So has the time come to say goodbye to zero and negative interest rates?
But there is more. Work is underway which aims at the development of a common supervisory culture; the adoption of a non-binding mediation mechanism among supervisors; the possible use of the crossborder delegation of supervisory tasks and responsibilities; and a further streamlining of banks’ reporting requirements.