PARIS (Reuters) - European regulators need to come up with clear and consistent vision for the future of its banks, the chief executive of France’s second-biggest lender, Credit Agricole (CAGR.PA), told Les Echos.
Bankers say regulatory burdens and insufficient synergies in retail operations are a major obstacle to consolidation in Europe’s fragmented sector.
It comes at a time when Wall Street banks’ dominance over struggling European lenders has reached record levels as U.S. firms reap the benefits of booming markets at home, while their rivals in Europe are trapped in endless restructurings.
“We have been told for years that banks are too big, so the post-crisis regulation has led to a reduction in the size of banks,” Credit Agricole Chief Executive Philippe Brassac told the newspaper in an interview.
Several European central bank chiefs, such as France’s Francois Villeroy de Galhau, have called for cross-border banking consolidation in Europe, admitting it was necessary to work on eliminating regulatory obstacles.
“And now we would be asked to consolidate? This cruelly reveals the lack of a political vision on the type of banking system that Europe wants to have,” Brassac said.
“The banking system in Europe is still a Europe of regulation and supervision: this defines the constraints, but does not set any ambitions,” he added.
Reporting by Maya Nikolaeva; Editing by Leigh Thomas and Louise Heavens