§ Mr. Teddy TaylorTo ask the Chancellor of the Exchequer what progress has been made in the Council of Finance Ministers in considering the second banking directive; if it is the general purpose of the draft directive that banks approved by their own state should be permitted to seek deposits, to offer loans and to engage in the full business of retail banking in another member state; and if he will make a statement on the position of Her Majesty's Government on the directive.
§ Mr. LilleyThe draft second banking coordination directive, which the Government have welcomed in principle as an important step towards the creation of a single market in financial services. It will give credit institutions (broadly, banks and building societies) the right to establish a branch in, or provide cross-border services into, another member state on the basis of their home state authorisation. This right will extend to a wide range of banking services including those mentioned. The directive is currently under detailed consideration in a Council working group of representatives from the member states and the Commission. The Commission has recently made revised proposals for a reciprocity provision in the directive. The Council of Ministers had an initial discussion of these new proposals on 17 April, and they are being considered further.