The ECB has taken a negative view on applying a rule that might have reduced the impact on BNP Paribas’s capital from its planned acquisition of Axa’s asset manager https://t.co/KzmNNc7RkT
ECB is reportedly against the BNP Paribas and AXA IM deals capital treatment
ECB SAID TO OPPOSE BNP PARIBAS' AXA IM DEAL CAPITAL TREATMENT
The European Central Bank (ECB) has issued warnings regarding the vulnerabilities of the fragmented European banking sector, particularly in light of recent market turbulence. The ECB highlighted financial risks stemming from shadow banks and hedge funds, noting potential liquidity shortages as a significant concern. In response to these challenges, ECB Executive Board member Isabel Schnabel emphasized the need for banks to simplify their risk models to enhance transparency and efficiency within the banking sector. Additionally, the ECB has ruled out a repeat of dividend bans, indicating that banks have managed to weather the recent turmoil. However, the ECB has expressed opposition to the capital treatment related to BNP Paribas's planned acquisition of AXA Investment Managers, which could have mitigated the impact on BNP Paribas’s capital. The regulatory body is also facing warnings from the Swiss bank lobby regarding the risks associated with UBS's potential relocation.
