Capital requirements of banks (CRD IV)
The euro crisis has revealed many weaknesses in the banking system. Banks had unsafe business models and insufficient 'security cushions' to endure persistent turbulence in interbank lending.
Taxpayers are having to pay enormous sums because there were no clear rules governing major banks' return to solvency.
Since the market assumed that state bail-outs would take place, these big banks were viewed as less risky investments and therefore benefited from lower interest rates.
Finally, traders have the wrong incentives, mostly as a result of poorly designed bonus payment systems.
What was the Greens' position?
The Greens believe banks need far stricter regulation if they are to avoid future crises and start serving the economy again.
Small banks with close ties to the real economy should not suffer from such regulation, but big banks should match their funding and asset profiles to make sure that their funding is stable and should no longer be able to hide real risks inherent in their business models by using internal formulas to evaluate their own risk-weighted assets.
We also believe that all banks should have to reveal how they dodge taxes and how they avoid regulation using shadow banks, that bonus payments should be limited in relation to fixed salaries and that a gender quota should be applied to banks' boards.
Did other MEPs accept the Greens' position?
The Greens succeeded in getting many of our demands incorporated into the EU's legislation.
The banking community was angry at our MEP Philippe Lamberts, who became known as "the man who capped the banks" for pushing through tough limits on bonuses.
Regulations on security cushions will be tougher for big banks.
Banks will also have to publish their earnings in all countries where they are present, so that any tax dodging can easily be traced back and combated.
Also, banks' internal risk models will be monitored more closely in the future.
Which points did the Greens lose?
However, the Greens were unable to convince the Member States in the Council to impose restrictions on banks' business models, especially their funding and asset profiles, with regard to their liquidity structure.
As a result, banks will remain vulnerable to liquidity problems on the interbank market.
We were also disappointed that our amendment calling for more women to be included on banks' boards was not adopted. Thus, banking will remain a male-dominated domain.
In addition, big banks' exposure to shadow banks will remain largely unclear, since they will only have to report to supervisors, not publicly disclose their links to hedge funds and other poorly regulated financial institutions.
Procedure:Ordinary legislative procedure
Lead MEP:Othmar Karas (EPP)
Green MEP responsible:Philippe Lamberts
Staff contact:David Kemp (Email)
Outcome of the vote
Below you find the results of the final vote in plenary. How did the political groups vote? What about national delegations? And what was the position of your MEP?