EU Officials Call for Larger Banks and Deeper Capital Markets to Compete with US Rivals
Senior European officials have emphasized the need for EU banks to grow in size and develop deeper capital markets if they are to effectively compete with their larger U.S. counterparts, as reported by Reuters on September 18, 2026. During a meeting of finance ministers and central bank governors in Dublin, discussions centered around removing political barriers that hinder cross-border banking mergers within the EU. European Central Bank Vice President Boris Vujcic noted while EU banks perform well in liquidity and profitability, they lag behind U.S. institutions in trading activities where scale is crucial. Euro zone finance ministers' chair Kyriakos Pierrakakis highlighted a significant investment gap between top U.S. banks and their European peers—particularly in IT spending relative to assets—which affects competitiveness in areas like AI and cybersecurity. Vujcic also rejected calls for reduced capital requirements, arguing this could lead to share buybacks rather than increased lending. To address fragmentation across the EU financial market caused by differing tax regimes and legal systems, officials urged completion of a unified banking and savings system.
Topics: bank mergers capital markets European banks regulatory reform