Why competitiveness should stay out of supervisory mandates

By Apostolos Thomadakis

Europe needs a more competitive financial system. Growth has been weak, innovation financing remains insufficient, capital markets are still too shallow and fragmented, and too much household wealth is still parked in low-yielding assets rather than channelled into productive investment. At a time when Europe wants to invest in defence, digital capacity, decarbonisation and strategic resilience, the question of financial competitiveness is entirely legitimate. What is far less clear is whether supervisors should be given a secondary mandate to promote it.