ECB’s Nouy says European banks must challenge US and Asian rivals

Daniele Nouy called on European bankers to strengthen the range of services they offer to companies on the continent and do more to challenge the dominance of their American and Asian counterparts.

Responding to a question about whether Europe needs bigger banks to compete with US and Asian rivals, the chairman of the Single Supervisory Mechanism – the ECB’s banking watchdog – said the Europe needed “a diverse . . . banking system” made up of large and small banks.

Ms Nouy added: “At least European companies should have the choice […] we are an important region of the world […] we are [responsible for] a big part of [global] exports. There should be one or two European champions.

European banks are eyeing mega-mergers to compete with bigger US rivals. However, efforts have been hampered due to the difficulty of cross-border mergers in the region.

Ms Nouy reiterated her previous calls for banks to step up their consolidation efforts and for politicians to complete the banking union by tightening rules on how to handle lender failure and launching a common system of guarantee of citizens’ deposits.

On Brexit, the SSM chairman – who will leave on December 31 – said: “We are ready to face all possible circumstances. Whatever happens, the British authorities will be – at least for my life – very important for us.