The so-called and much discussed Mifid 2 came into force at the beginning of the year. This is the new European directive in the banking sector which, perhaps more than the others that preceded it, will change the relationship between savers on the one hand and banks and financial advisors on the other.
The new rules will serve to provide greater protection to savers and investors, especially small and medium-sized ones, focusing everything on information transparency, on the advisory service, on knowledge and
competence (by virtue of which principle only personnel with the necessary and specific knowledge and skills will be able to provide advice), on product governance (which regulates upstream the production of the most suitable financial instruments for customers) and on the detailed regulation of the incentives of intermediaries , and on the more general and ancient principle of the adequacy of the financial product to the customer.
In a nutshell, as indeed happened in the past, but today, in a more rigid, more detailed and stricter way, it will be mandatory to ensure that every customer is the intermediary, be it a financial advisor or a banker - who they will have to be increasingly prepared and specialized – offer more products, designed for that type of clientele and in any case compatible with their personal profile.
Nothing new under heaven but all much more complicated. The new legislation is, in fact, very complex – it is even written on seven thousand pages! – and its application will be very expensive. According to a calculation by the Financial Times, for the European asset management industry, immediately adapting information services to the new directive will cost 2,5 billion, which could easily rise.
These are not only costs, however high, of compliance and technology but also other costs that are completely unpredictable today. Again, only those who have strong roots and their own strength will be able to face it and resist without succumbing. On the other hand, the higher costs should correspond to higher revenues thanks to the development of new alternative financial products which up to now, especially in Italy, have only been used marginally.
The new products would have the primary purpose of making it possible to manage significant assets (according to the Bank of Italy in 2016 it was 32%) that lies unused in current accounts and deposits.
Therefore, Mifid 2 whose complex application will have high costs, as well as increasing the safety of savers and investors, rebalancing their relationships more equally than in the past, should see, hopefully, higher revenues for banks by 3,5, XNUMX billion euros over the next five years thanks precisely to the new products which, with the protection of the new legislation, savers will no longer leave non-interest bearing current accounts "under the brick".
Cooperative and local banks that have always invested in financial education, considering it a necessary element to maintain a strong bond of trust with their customers, an element that distinguishes them from the rest of the banking scene, have decided to invest in the potential of the new legislation . They were ready for the appointment and, also to cope with the important potential, they equipped themselves with an operational tool.
Even before the entry into force of Mifid 2, in December, they set up a joint-stock company which was named, in honor of the founder of the cooperative institutes, “Luigi Luzzatti SpA”. The new company - chaired by Vito Primiceri, Chairman of Banca Popolare Pugliese - is not only a vehicle for the management of NPLs, but also a tool for offering and managing activities of common interest to create and develop appropriate economies of scale.
It will put people's banks in a position to investigate the fundamental strategic issues, to address the
future of banking operations in constant and progressive evolution, from the management of NPLs to training and legislative and regulatory analysis. Once again, Credito Popolare is proposing itself with renewed vitality and, above all, with the ability to look to the future of the sector. "Luigi Luzzatti SpA" will make it possible to face today's challenges and those of the coming years with renewed commitment.
°°°The author is the Secretary General of the National Association of Popular Banks (Assopopolari)
