Responding to the European Commission’s announcement today regarding the Capital Markets Union (CMU), Michaela Koller, director general of Insurance Europe, said:
“We welcome that the European Commission has, in the context of the CMU action plan, taken steps to make swift changes in the Solvency II treatment of infrastructure. However, the capital charges for both debt and equity infrastructure investments remain significantly in excess of the actual risks which these assets pose to insurers’ portfolios. There is also little or no recognition of the diversification benefits that infrastructure brings to insurers’ portfolios. Therefore, while they are a step in the right direction, these changes are not enough to remove the barriers to investment by insurers.
“Insurance Europe welcomes the Commission’s call for evidence on the cumulative impact of legislation. This represents a significant step forward in the path towards achieving the Commission’s goal for more coherent and effective regulation.
“We also welcome the Commission’s initiative to revive the securitisations market and the recognition that the Solvency II treatment of securitisations needs changes. We look forward to seeing, at a later stage, the Commission’s proposals on changing calibrations for securitisations, which are still far too high relative to the risks involved. Further improvements will be necessary and, therefore, we appreciate that the Commission highlighted in their plan the review processes in place for achieving this.”