Brussels Is Speaking the Language of Business: What the 2026 State of the Union Means for Financial Services

Every autumn, European Commission President Ursula von der Leyen addresses the European Parliament in a speech that policymakers and business leaders follow closely. It reviews the past year, sets out priorities for the year ahead and explains how the Commission intends to tackle the Union's most pressing problems.

The speech is worth listening to carefully. What is said matters, and so does what is left out. It signals which legislation, funding programmes and priorities Brussels will take on next, and sooner or later that shapes the daily reality of every company operating in the single market.

Here is my reading of this year's speech from a financial services perspective.

Banking and capital markets: growth, not only stability

For financial services, the most important message was that companies need better conditions to raise investment and grow. According to von der Leyen, the work on the Savings and Investments Union is crucial and the needs of businesses are urgent. At the same time, building deep capital markets takes time. That is why Europe needs a banking system geared towards growth, not only towards stability.

The Commission promised a new banking package aimed at simplifying the rules and reducing fragmentation. The line that stayed with me: we know the demand for capital is there, but we need more capacity and more appetite for risk.

This matters most where companies rely heavily on bank lending and local capital markets are small, which is the case in much of Europe. If European banking rules become more growth-oriented, it will directly affect how easily a European company can get a loan.

Ending gold-plating

The Commission has recently made several proposals to reduce the administrative burden, and this year's speech confirmed that the work continues. This time, the Commission President also turned to the Member States. She proposed an anti-gold-plating agreement, under which Member States would commit not to add their own extra requirements when transposing EU legislation.

For financial services, this is significant. Gold-plating is one of the main reasons why the single market for financial services still feels like 27 markets. Every additional national requirement makes cross-border scaling more expensive, and the cost falls hardest on smaller markets and smaller firms.

Insurance: closing the climate protection gap

The speech also highlighted a problem in insurance that climate change is making ever more acute. This year's extreme summer, with droughts, wildfires and heatwaves across Europe, showed it clearly. According to von der Leyen, private insurance currently covers only around a quarter of Europe's catastrophe losses, which means that the state too often ends up as the insurer of last resort, paying for the damage from its own budget.

The Commission will therefore create a Climate Insurance Alliance, bringing insurers, investors, risk modellers, the public sector and policyholders around one table. The aim is to find solutions that make cover more accessible, for example through group insurance or parametric insurance. Von der Leyen also promised separate proposals to reduce the protection gap in agriculture.

In many Member States, agricultural and climate risk insurance is still at an early stage, and after a major loss everyone eventually turns to the state. Whoever first finds a sensible way to share risk between the state and insurers could become a model for the whole of Europe. Climate change is increasing both the frequency and the severity of losses, and it is testing existing insurance models.

Digital Fairness Act: a horizontal rulebook that will reach finance

For banks, insurers and fintechs alike, it matters that the speech confirmed the Digital Fairness Act is coming this autumn. It is a horizontal act covering all sectors, and one of the Commission's most important consumer protection initiatives of this mandate.

The act addresses four themes: manipulative user interfaces (dark patterns), addictive design, influencer marketing on social media, and personalisation that may be unfair to consumers, for example pricing based on personal data.

Every financial services provider should therefore be ready to review the design and marketing of its products, including:

• the use of influencers and finfluencers;
• gamification in investment and trading apps;
• personalised pricing.

One Europe, One Market

The speech also briefly mentioned the "One Europe, One Market" roadmap, agreed by the European Parliament, the Council and the Commission in April. According to the Commission President, the historic transformation of the single market can and must be completed together by the end of next year.

Behind the short name sits a whole series of pending files that directly affect financial services:

• the supplementary pensions package, including the review of the occupational pensions directive (IORP II) and the Pan-European Personal Pension Product (PEPP) regulation;
• the capital markets integration and supervision package;
• the digital euro;
• "EU Inc", a pan-European company form that should make it easier to set up and scale companies, including fintechs, across borders.

What to watch next

The message to financial services was clear: Brussels wants faster growth and less bureaucracy.

The Savings and Investments Union is a long-term project. Until it delivers, growth has to be financed by banks that dare to lend more to companies.

Risk appetite can partly be steered through rules. The banking package and the anti-gold-plating agreement should give banks and investors more room. The rest depends on market participants themselves.

Speed does not mean that Europe is giving up its values. The Digital Fairness Act and the Climate Insurance Alliance show that while looking for growth, Europe also wants to protect consumers and society.

In the coming months, I will be following:

• the content of the new banking package and how far simplification really goes;
• whether Member States sign up to the anti-gold-plating agreement, and how seriously they apply it;
• the Digital Fairness Act proposal and its implications for financial product design and marketing;
• the first concrete steps of the Climate Insurance Alliance;
• progress on the One Europe, One Market files before the end-2027 deadline.

It seems the European Union is increasingly speaking the language of business, without forgetting its values. That is a reason for optimism. There is always more to do and things that could be better, but that is exactly the kind of pressure that drives innovation and progress.

An earlier version of this article was published in Estonian in Äripäev.

I help financial institutions and supervisors turn EU regulatory change into strategy. For weekly analysis on financial innovation and regulation in Europe, subscribe to my newsletter.