These reforms can go a long way toward increasing loss absorbency, reducing incentives to take excessive risks and increase leverage, and reducing the social costs of bank failures and the need for implicit public guarantees.
The High-level Expert Group was requested to consider whether there is a need for structural reforms of the EU banking sector or not and to make any relevant proposals as appropriate, with the objective of establishing a stable and efficient banking system serving the needs of citizens, the economy and the internal market.