ICMA sets out priorities for EU banking competitiveness reform
3 November 2026 ICMA has published a new position paper on EU banking competitiveness, contributing to the discussion in light of the upcoming legislation and highlighting the essential role of banks in supporting deeper, more liquid and resilient European debt capital markets.
The paper argues that banking competitiveness and capital market development must be treated as a single policy challenge. Banks are central to bond underwriting, market-making, hedging and repo financing, yet overlapping regulatory requirements can constrain their capacity to support these activities. ICMA calls on policymakers to address overlapping regulatory constraints and thus help increase banks’ usable balance sheet capacity for market-making, underwriting and repo financing, while maintaining robust prudential safeguards.
Key recommendations
- ICMA calls for reforms built around three priorities: scale, simplicity and capacity. Its recommendations include:
Strengthening bond market-making and underwriting capacity by addressing regulatory constraints on banks' ability to deploy balance sheets efficiently. - Enhancing the depth, efficiency and resilience of repo markets through more risk-sensitive prudential requirements and improved collateral management.
- Simplifying and aligning regulation by reducing unnecessary duplication, improving international consistency and removing barriers to cross-border market activity.
ICMA emphasises that these reforms should preserve financial stability and strong prudential standards while enabling banks to play their full role in delivering the EU's Savings and Investments Union ambitions.
