Senior European officials said European banks need greater scale and deeper capital markets to compete with US rivals, as EU finance ministers and central bank governors met in Dublin to discuss a European Commission report calling for less political interference in bank mergers and the removal of barriers to cross-border banking within the bloc. European Central Bank Vice President Boris Vujcic told Reuters that EU banks compare well with US peers on liquidity, capitalisation, profitability and efficiency but lag in trading and post-trading activities, where scale really matters. Euro zone finance ministers' chair Kyriakos Pierrakakis said greater integration and further cross-border consolidation would give European banks the scale to invest, innovate and compete, adding that the largest US banks invest more than two-and-a-half times as much in information technology relative to their assets as European lenders. The meeting follows Germany's June rejection of an offer from Italy's UniCredit to take over Commerzbank, a deal UniCredit began pursuing in September 2024 and which has faced strong opposition, highlighting the difficulty of cross-border banking deals in Europe. Vujcic pushed back against calls from some bankers for lower capital requirements, saying this would not necessarily boost lending and could instead fuel share buybacks, and urged the EU to complete its banking union and savings and investments union to create a truly integrated financial market.
Commerzbank AGGermany's rejection of UniCredit's takeover offer for Commerzbank is cited as highlighting barriers to cross-border bank mergers, which EU officials now want removed.
UniCredit SpAUniCredit's pursuit of Commerzbank since Sept 2024 and Germany's June rejection are cited as the example of obstacles to cross-border consolidation that EU officials want to ease.
