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The European Union is accelerating the process of financial integration with the creation of the Savings and Investments Union (SIU), presented by the European Commission on 19 March in Brussels.
This new framework aims to centralise control over large asset managers, remove barriers to cross-border investments and make savings more productive. One of the main objectives of the SIU is to strengthen supervision of financial markets. The European Securities and Markets Authority (ESMA) seems to be the most suitable candidate to take on this task. However, the transition to unified supervision will be gradual. In the fourth quarter of 2025, the European Commission will present a proposal to transfer some competences from national authorities to a European level. This measure will particularly concern asset managers with a significant cross-border presence, which are difficult to control by the authorities of a single State alone. This approach is reminiscent of the model already adopted for banking supervision, with the aim of ensuring equal treatment between market players.
The current fragmentation of the European market hinders the growth of companies operating in multiple Member States. For this reason, the second pillar of the SIU provides for the elimination of regulatory and supervisory barriers, thus facilitating cross-border financial operations. This would improve synergies between European companies and strengthen their global competitiveness. In parallel, work is being done on the banking union, a crucial element in creating a more integrated and competitive credit sector. A stronger and more uniform banking system would improve access to capital for companies, helping them to finance innovation and expansion. One of the major problems of the European financial market is the difficulty for companies, especially startups, to obtain funding without resorting to financing from outside the continent. To solve this problem, the Commission aims to incentivize equity investments by pension funds and insurance companies, with a particular focus on the venture capital sector. This stimulus to private capital can provide companies with essential resources for growth and innovation. One of the most important aspects of the SIU concerns the optimization of European savings. Currently, around €10 trillion is deposited in Europeans’ bank accounts, a huge amount that could be put to better use. The Commission does not intend to force citizens to invest, but wants to direct a portion of these savings to European companies to foster economic growth and reduce dependence on external capital. To achieve this goal, Brussels is considering the introduction of savings accounts with tax incentives, designed to facilitate small savers’ access to capital markets. Another area of intervention concerns supplementary pension funds, with the aim of creating more profitable and safe financial tools to face the challenges of retirement and major life events. According to the Commission’s estimates, these measures could guarantee €470 billion in additional funding per year for European companies.
In addition to financial reform, the European Commission has outlined an ambitious plan to strengthen common defense. Ursula von der Leyen has estimated that the EU could mobilize €800 billion for European rearmament, with the aim of increasing deterrence against Russia. According to Commissioner Andrius Kubilius, “If we want to avoid war, we must be ready for it”, stressing the importance of adequate military preparation by 2030. The strategy includes the adoption of common procurement for military supplies, in order to reduce fragmentation between Member States and ensure interoperability between European weapons. In addition, preference will be given to companies from the continent, with companies such as Leonardo recognized as leaders in the defense sector.
The creation of the Savings and Investments Union is a key step for the EU’s financial integration. Strengthening market surveillance, removing barriers to investment and optimizing European savings can make the continent more competitive globally. At the same time, Europe is preparing to face security challenges with an ambitious rearmament plan, which aims to strengthen common defense and reduce dependence on non-European suppliers. In the coming years, the success of these initiatives will depend on the EU’s ability to find a balance between regulation, economic growth and international security.
Alessandro Fiorentino