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In March 2025, the European Commission unveiled the politically and economically long-awaited Savings and Investments Union’ strategy, SIU. Generally, the SIU’s aims are numerous: e.g. to enhance citizens’ wealth, bolster economic competitiveness, as well as facilitating European socio-economic integration.
Background
By adopting the SIU, the Commission intends to improve the way the EU financial system channels savings to productive investments. It seeks to offer EU citizens broader access to capital markets and better financing options for companies; it can foster citizens’ wealth, while boosting EU economic growth and competitiveness.
Thus, Ursula von der Leyen, President of the European Commission, said on the occasion of the SIU adoption in March 2025: “With the proposal for a Savings and Investment Union we are achieving a double win: households will have more and safer opportunities to invest in capital markets and increase peoples’ wealth; at the same time, businesses will have easier access to capital to innovate, grow and create good jobs in Europe.”
M. L. Albuquerque, Commissioner for Financial Services (and also for SIU) added: “Europeans are some of the best savers in the world, but many of their savings are sitting in low-yield deposit accounts. At the same time, Europe is struggling to meet its investment needs. With the SIU, we can create a virtuous cycle for the benefit of both citizens and companies, helping Europeans get a better return on their hard-earned savings, while bringing substantial investment into the economy. There are barriers we need to overcome to make this happen, and … we have a guide for this vital work”.
Besides, in Q2 2027, the Commission will publish a mid-term review of the overall progress in achieving the Savings and Investments Union.
Source and citations from: https://ec.europa.eu/commission/presscorner/detail/en/ip_25_802
Improving the EU financial system
The Savings and Investments Union is a key Commission’s initiative to improve the way the EU financial system channels savings to productive investments. The initiative seeks to offer EU citizens broader access to capital markets and better financing options for companies; it could foster citizens’ wealth, while boosting states’ economic growth and competitiveness.
Europe’s capacity to address current challenges demands significant investments; much of the investment needs relate to small and medium sized enterprises and innovative companies, which cannot rely solely on bank financing. By developing integrated capital markets – alongside a modern banking system – the SIU can effectively connect savings and investment needs.
The SIU intends to mobilize private and public capital across the EU member states, ensuring that savings are efficiently channeled into investments that drive economic growth, innovation and stability. The SIU seeks to affect interest rates, job opportunities and financial security for investors, entrepreneurs and workers; it helps individuals and businesses make better financial decisions in an increasingly interconnected world. Implementing the SIU will rest on both legislative and non-legislative measures, and on measures to be developed by the EU member states
This comprehensive strategy seeks to address complex issues, following the previous initiatives and actions in other already existing “financial unions”: Capital Markets Union, CMU and the Banking Union, supported by “feed-backs” from the European Parliament, the European Council, the Eurogroup, the European Central Bank, ECB, as well as expert reports by Christian Noyer, Enrico Letta and Mario Draghi (April-September 2024).
More in related links: – Savings and investments union; – Capital markets union; – Banking union; – Retail financial services; and – Financial markets.
As Michael Huertas (Partner with PwC Legal) noticed, the SIU aims are: to reduce the persistent fragmentation in EU financial markets, improve financial inter-mediation and increase retail participation in capital markets. In the current economic and geopolitical environment, the SIU strategy remains a pivotal step towards creating a more integrated and efficient financial system within the EU, with a strong emphasis on channeling funds currently held as bank deposits into capital market products, to also advance progress on sustainable finance and geopolitical resilience.
Source and citation from: https://legal.pwc.de/en/news/articles/the-eus-2025-savings-and-investments-union-strategy
Shared EU-states competence
According to the EU integration legislation, all socio-economic spheres are regulated by the EU institutions exclusively, in shared competence (between the EU and the states) and/or by supplementing activities (almost solely performed by the member states). Delivering the SIU is a shared responsibility of the EU institutions, the member states and all key stakeholders, requiring concerted efforts and close collaboration across five strands of shared work:
1. Citizens and savings: Retail savers already play a central role in financing the EU economy via bank deposits, but they should have the opportunity, if they wish, to hold more of their savings in higher-yielding capital-market instruments including in view of retirement.
2.Investment and financing: To stimulate investments, and in particular those in critical sectors, the Commission will introduce initiatives aimed at improving capital availability and access for all businesses, including small and medium enterprises.
3. Integration and scale: Reducing inefficiencies stemming from fragmentation will entail important efforts to remove any regulatory or supervisory barriers to cross-border operations of market infrastructures, asset management and distribution of funds. This will enable businesses to scale efficiently across the EU.
4. Efficient supervision in the Single Market: The Commission will propose measures to ensure that all financial market participants receive similar treatment, irrespective of their location in the EU-27. This will entail reinforcing the use of convergence tools as well as a reallocation of supervisory competences between the member states’ and the EU levels.
5. Finally, the SIU also aims to enhance the integration and competitiveness of the EU banking sector, including through the deepening of the Banking Union. The Commission will also assess the overall situation of the banking system in the Single Market, including its competitiveness.
Source: https://ec.europa.eu/commission/presscorner/detail/en/ip_25_802
Our comment
There is a huge literature on financial systemic in two competing sides; though quite a few on comparing the US and EU financial systems. We advise our readers to look at the following sources:
a) a rather old (2007) but still interesting article in – https://www.elibrary.imf.org/display/book/9781589066236/ch004.xml#:~:text=This%20chapter%20analyzes%20differences%20in%20efficiency%20and%20competition,fragmented%20in%20both%20areas%20until%20the%20late%201980s .
b) an article on “significant differences between the two systems” (2017) in: https://www.cambridge.org/core/journals/european-journal-of-risk-regulation/article/abs/divergences-between-eu-and-us-in-the-financial-regulation/08E63E3775FFBE707591CF38799F8EF8 ; and
c) a rather new article (2021) on US-EU financial markets in – https://www.fe.training/free-resources/financial-markets/market-overview-of-us-vs-eu/
Besides, there are some articles in our files: e.g. https://www.integrin.dk/2024/09/09/eu-wide-competitiveness-challenges-and-perspectives-in-draghi-report/; https://www.integrin.dk/2024/11/11/single-market-for-capital-european-investment-policy-through-reforms/ and https://www.integrin.dk/2024/10/16/european-financial-market-and-investment-facing-competitiveness-challenges/ to name a few…