(Feb 19): European lenders could lose out to international competitors if regulators don’t look into whether the industry is overly burdened by rules, according to Italian central bank governor Fabio Panetta.

“We need to avoid excesses in regulation,” Panetta said on Wednesday in Rome. “In the past, this didn’t generate competitive disadvantages. Now it’s a concrete risk.”

Bloomberg reported on Tuesday that Panetta — alongside his counterparts in Spain, Germany and France — had written to the European Commission to call for a simplification of banking regulations.

Such an approach “doesn’t mean deregulation, but an overall evaluation to see if there isn’t an excessive load of regulation,” Panetta said.

The election of the US President Donald Trump in the US has emboldened finance executives around the world to demand a roll-back of regulations put in place over the last decade. The rules stretch from issues such as capital strength to environmental-reporting requirements that the industry complains are overly complex and hamper lending.

Panetta said Europe shouldn’t chase the US on deregulation.

“A race to the bottom isn’t a good idea because it would endanger the work done after the financial crisis,” he said.

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