Speech: Remarks by Vice-President Dombrovskis at the ECOFIN press conference

Thank you, Edward.

First let me thank you personally and the Maltese Presidency for the excellent work you have been doing.

A special thanks for your strong support to the Capital Markets Union and for advancing the initiatives that we have put forward in our Action Plan.

Thanks to the Presidency, we have reached a deal in principle to restart securitisation markets. And we also reached a political agreement on rules to strengthen funds for venture capital and social entrepreneurship.

Today I presented to the Ministers the Capital Markets Union mid-term review. We hope we can count on their strong political support to the new actions that we will soon be proposing.

Already by the end of this month we will come forward with a legislative proposal on a pan-European Personal Pensions product.

We also appreciate the work of the Presidency on the Banking package. This package, which was presented at the end of last year, aims to reduce risk in the banking sector.

We welcome today's agreement on two important measures:

First, the agreement on the bank creditor hierarchy, which will allow for larger banks to build robust buffers of bail-inable debt by establishing this common European asset class. This will give more clarity to investors and help them to assess and price risk.

Second, we welcome the deal on transitional provision for the International Financing Reporting Standard 9 - or so called IFRS 9 - and certain large exposures. This will allow the alleviation of potentially negative impacts on banks.

It is important now that also the European Parliament moves quickly with those files.

Today's agreements send a good signal that Europe is advancing steadily on completing our regulatory framework for banks.

Today we also discussed the European Semester and the Country Specific Recommendations where Ministers broadly supported the Commission's proposal. We agree that the time is right to reform our economies to make them more resilient and strengthen economic growth.

As regards fiscal policies, I would like to congratulate Croatia and Portugal, as Ministers supported our recommendation to abrogate the Excessive Deficit Procedures for those two countries.

We see that the overall picture of public finances continues to improve and with the abrogation of these two countries, only four Member States will continue to be subject of the excessive deficit procedure. To compare, in 2011 there were 23 Member States in the corrective arm of the Stability and Growth Pact.

As regards the preventive arm, there are 8 countries - Germany, Luxembourg, Malta, the Netherlands, Bulgaria, Czech Republic, Denmark, and Sweden - that are projected to be at or above their medium-term budgetary objectives both this year and next and correspondingly they receive no fiscal recommendations.

Unfortunately, we also see Member States which are deviating from their budgetary objectives. That is why Italy, for example, had to take additional structural measures worth 0.2% of GDP this year.

Today the Council agreed with our recommendation to give warning to Romania on the existence of a significant observed deviation from the adjustment path towards the medium-term objective in 2016.

When it comes to the fiscal effort of other Member States not yet close to their Medium Term Budgetary Objectives, we welcome that Ministers recognise the need to both strengthen the on-going recovery and to ensure the sustainability of public finances.

Last but not least, we informed Ministers about the good progress made in implementing the Action Plan for the fight against terrorism financing.

We have two main strands of actions: how to further detect and prevent terrorist funding, and how to disrupt their sources of revenues.

Timely delivery of those proposals is our top priority so we continue to work intensively on this plan.

Thank you.

SPEECH/17/1654