The European Union is likely to advance banking reforms in 2027 that reduce internal barriers to cross-border banking, boosting its financial competitiveness by freeing up funds tied up in savings, but will stop short of significantly greater fiscal and financial risk sharing. On July 17, the European Commission published a proposal to reform the EU banking sector to enhance its competitiveness. This is part of its broader efforts to establish a Savings and Investment Union, itself aimed at promoting the efficient allocation of capital to help address Europe's large and increasing financing needs. The proposal would reduce internal barriers that prevent EU banks from expanding in other EU countries and growing the scale needed to compete globally. Once transformed into a legislative package, EU member states, and then the European Parliament, would need to approve the measures before the reforms could become law.