Challenges and issues of the financial sector concerning the European Union in the forthcoming years

This paper is meant to be a general, non-exhaustive collection of snapshots and thoughts, also partially elaborated from exchanges with institutional counterparts, about the main issues for the next EU Commission in the domain of financial services. The intention is not to present an elaborated academic analysis about such topics, but, rather, to raise the awareness about the main pending issues in the economic and financial affairs domain, at the moment of a new EU Commission is taking office. This will range from the area of the complete Banking Union, being a significant trigger for reforms and for the direction of future Europe, as well as to the possible Insurance Union (e.g. the shift of EIOPA role from coordinator to central regulator); and, more in general, to the future architecture of the financial and monetary Europe. Topics include micro-economics, starting from the peculiar case of the state of the financial sector in Europe, with low profitability / low interest rates, cost reduction issues, NPLs and all the main regulatory reforms still on the table. Money laundering issues, particularly in conjunction with digital evolution and the consequent pressure on traditional banking sector; risk control, including rules for leveraged finance. But, also, macro-economic topics, starting from the effects of a possible U.S. economic downturn, including China-US trade war and connected impacts; public debt and aggregate private debt as a macroprudential issue; Brexit & the single Capital Market. Amongst others, topics such as digital innovation, climate change, market efficiency (LIBOR / EURIBOR trends? Impacts on bonds and stock market?) and sustainability of the European position internationally in the financial markets. Today in all these domains it does not seem that Europe speaks with one voice in all those, rather, national and sub-regional interests seem to prevail, jeopardizing the long-term perspective of an efficient European architecture, capable of generating growth and stability which is currently the only way to respond effectively to the challenges ahead.