The chairman of Societe Generale said Europe‘s banking space should follow in the footsteps of the U.S.’s, calling on regulators to facilitate more consolidation in the region.

Speaking to CNBC over the weekend, Lorenzo Bini Smaghi said that European banks need to become more concentrated, so they can compete with American lenders.

“In general if we look at Europe, obviously there are too many banks and it’s too fragmented so I think Europe needs to move in a direction of more concentration to help better the real economy. If we compare (it) to the U.S., we’ve seen this process of concentration 30 years ago,” Smaghi told CNBC’s Charlotte Reed.

The French lender announced the acquisition of the equity markets and commodities arm of the German firm Commerzbank last week. The deal, which still needs to be cleared by regulators, is an attempt to have a larger presence in the German market at a time when Deutsche Bank is re-defining its strategy, after recent turmoil and management changes.

According to Smaghi, the transformation of European banks “has to come.”

“And of course as chairman of SocGen I can say that we will be a protagonist in this process. But this requires for things to happen on the regulatory side.”

“I’m not suggesting anything at this stage, just that we need more concentrated and larger banks able to compete with the American banks,” he said on potential new mergers.

On Friday, reports suggested that J.P. Morgan and the Industrial and Commercial Bank of China were looking to buy Deutsche Bank, which was promptly denied. In June, another French bank, BNP Paribas bought the asset manager DWS, which was owned by Deutsche Bank. The move was also seen as an attempt to increase its presence in the German market.

However, according to Elisabeth Rudman, managing director at DBRS, consolidation is not always the best strategy for these banks.

“We’ve seen big cross-border mergers and acquisitions in the banking sector in the past and a lot of them did not turn out very well at all … (It’s) difficult to see that as a solution to everything,” she told CNBC’s “Squawk Box Europe” Monday.

“Europe is, in many ways, overbanked and there are still a lot of banks, some big banks and some small banks that are still struggling. But there’s not going to be an overnight solution,” Rudman added.