April 28, 2025 – Brussels/Frankfurt — The European Central Bank (ECB) has reportedly created a high-level task force aimed at simplifying Europe’s increasingly complex banking regulations. According to a Reuters report published Saturday (April 26), the initiative is being led by ECB Vice President Luis de Guindos and includes central bank governors from Germany, France, Italy, and Finland.
While the ECB does not hold the authority to directly change banking laws—which are legislated by the European Union—the task force will develop policy recommendations that could inform future legislation.
Call to Reform “Unduly Complex” Rules
Earlier this year, central bank governors from Germany, France, Italy, and Spain sent a joint letter to European Commissioner Maria Luis Albuquerque, urging for the simplification of Europe’s banking rulebook. The letter argued that current financial regulations are “unduly complex” and risk creating unintended barriers across the EU banking sector.
“A comprehensive analysis of the implications of all the standards produced in Europe should be carried out,” the letter stated, “to ensure that they do not cumulatively add unintended layers of rules and expectations.”
The signatories proposed that the review could lead to a legislative proposal featuring “concrete and realistic simplification measures.”
ECB’s Top Supervisor Defends Complexity
Despite growing calls for simplification, Claudia Buch, the ECB’s Chief Banking Supervisor, defended the existing regulatory framework during a public event in Washington, D.C. last week.
“It is sometimes argued that banking rules are too complex,” Buch said. “But for regulation to effectively address the industry’s specific needs and vulnerabilities, it must be sufficiently detailed.”
Her comments reflect the ongoing debate between maintaining robust oversight and fostering a more agile regulatory environment.
U.S. Regulators Shift Tone on Crypto Banking
In a separate but related development, two major U.S. regulators—the Federal Reserve and the Federal Deposit Insurance Corporation (FDIC)—have recently withdrawn prior warnings that discouraged banks from engaging with cryptocurrencies.
The move signals a more open regulatory stance toward digital asset activities, as long as financial institutions act prudently and within legal frameworks.
The Fed also rescinded supervisory letters from 2022 and 2023, which previously required state member banks to notify the central bank about crypto-related activities, including those involving dollar tokens. The Office of the Comptroller of the Currency (OCC) also reclarified its position on crypto banking last month.
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