During 2019, initiatives to support innovation and growth, in line with European Union projects and objectives were promoted. Monitoring and advocacy activities before EU policy makers were conducted with the goal of actively contributing to debates in related to the definition of regulations in the banking and financial space and in support of retail customers, with the ultimate aim of facilitating the role of Intesa Sanpaolo in relaunching the recovery of the real economy.
2019 was a year that saw an increase of the political pressure at European level for sustainability, that has been declared as a priority and a central issue by the von der Leyen Commission that entered into office in December 2019.
The Group has monitored and carried out advocacy activities on the European Commission's initiatives that are part of the first Action Plan on sustainable finance, while has also participated to the sustainable finance working groups of the European Banking Federation (EBF) and of the Association for Financial Markets in Europe (AFME). The main EBF working group has been articulated in six technical sub-groups. Intesa Sanpaolo has contributed in particular to the discussions on the creation of a European Taxonomy for sustainability and on incentives (both demand and offer-side) for further developing the funding of sustainable investments.
In addition, Intesa Sanpaolo has continued being part of the European Commission's Group of Experts for the financing of the circular economy. The Expert Group has published a report containing some recommendations in June 2019.
Also the legislative process related to the negotiations of the Multiannual Financial Framework (MFF) has been closely monitored, with specific attention being paid to opportunities linked to existing and forthcoming financial instruments. Finally, deep dives on growth strategies linked to the New Green deal have been carried out.
There is an ongoing coordination of internal and external working groups active on issues relating to banking digitalisation, such as FinTech and payments, Distributed Ledger Technology, Blockchain, cloud, cyber security, artificial intelligence, privacy and, in general, the development of innovative digital solutions with the aim of promoting the Group's position in Europe.
The collaboration with European trade bodies, which has seen the participation of Intesa Sanpaolo experts in the thematic working groups that defined the positions of the industry on the main European initiatives in the digital field, has continued on these issues.
The objective of these activities is to maintain a profitable exchange with the business structures on the challenges and opportunities emerging from the digititalisation process, with the aim of improving customer satisfaction and contributing to ensuring maximum protection of the Bank and its customers. In particular, in line with this latter objective, the Group has launched and coordinated a working group on the harmonization of incident reports and continued to play a proactive role in the public-private Partnership on Cybersecurity – European Cyber Security Organisation - ECSO, supported by the European Commission, to develop Innovative European solutions from a cybersecurity perspective.
The Group was awarded a European tender thus obtaining EU funds for the development of a common application for the harmonisation of cyber incident reporting and is currently implementing it.
In relation to blockchain, the Group has become a member of INATBA – the International Association for Trusted Blockchain Applications - that represents a discussion forum with regulators and policy makers at a global level for developers and users of DLT. This Group also helps bringing DLT technology to the next level.
On cloud, the Group is part of the European Banking Federation Cloud Banking Forum, whose role is to facilitate the dialogue between relevant authorities, cloud services providers (CSPs) and banks with the aim of promoting a harmonized supervisory approach in relation to cloud computing and of supporting the rapid adoption of public/hybrid cloud solutions in the banking space.
The Group has also adhered to AI4People a new multi-stakeholders forum dealing with Artificial Intelligence, whose aim is to create a public room where outlining the founding principles, policies and practices on which a “good AI for society” can be built.
As to payments, the Group keeps monitoring the developments of the European Directive on Payment Services (PSD2) and in particular the relevant level two legislation in order to ensure, in particular, adequate consumer protection and the security of electronic payments in the interaction with payment service providers.
From the point of view of banking regulation and prudential requirements, the Bank has tracked the legislative activities relating to:
- the revision of the legislation on capital requirements and management of banking crises;
- the completion of the Banking Union;
- the systemic risk reduction.
In particular, also from the prudential point of view, the bank has positioned itself by supporting proposals aimed at promoting green investments, infrastructural projects and aimed at supporting the economy (e.g. factoring, trade finance), software investments .
Furthermore, the Bank has also promoted and obtained revised liquidity measures supporting factoring and trade finance, which are key for EU enterprises, in particular for those operating on an international level. The Bank has also stressed the need for further prudential measures to promote lending to the SMEs, which has been finally introduced.
The Bank has closely monitored the regulatory proposal related to the Credit servicers and credit purchaser within the EU Action Plan on NPL. A fair calibration of all these measures will make the banking system more resilient and protect firms and depositors at EU level
As regards the financial markets, among others, the following were monitored and subject to advocacy:
- the regulatory initiatives related to the Capital Markets Union (CMU), in particular with reference to covered bonds and securitisations;
the Prospectus regulations;
- the revision of the European Market Infrastructure Regulation (i.e. EMIR 2.0 () and EMIR Refit Regulations ;
- the evolution of the level two regulations for MiFID (Regulation on the transparency of financial transactions in securities) and EMIR (European Market Infrastructure Regulation).
The Bank has striven for the adoption by the EU of contingency measures in case of hard-Brexit in particular for the temporary recognition of UK based Central counterparties.
The Group functions involved are kept constantly updated through periodic newsletters concerning European policies for growth, innovation, support to businesses, digital policies and those relating to banking and financial market regulations. Targeted updates (so-called EU Regulatory Alerts) are also sent, in the presence of significant news related to regulations that require particularly attention due to the impact they may have on the Group's strategy and activities and, depending on the priority indicated, require the definition of the Group's position to be presented to the European institutions and other stakeholders.
In order to make the activities of the internal working groups more effective, support and training are provided to Group Departments and Services, in particular through seminars aimed not only at presenting the peculiarities of the European legislative process and the possibility for the Group to influence its final decisions, but also at illustrating the status of the art of the most relevant incoming regulations.
Since the SSM (Single Supervisory Mechanism) was launched at the end of 2014, the Department maintains an ongoing relationship with the Single European Supervisor, coordinating the Group's annual supervision plan, aiming to ensure due consistency and uniformity in interaction processes with the supervisor and to promote a widespread culture of "supervisory awareness" to increasingly strengthen the capacity to respond to Supervisor's requests.