The European Central
Bank (ECB) is preparing to take on new banking supervision tasks as part of a Single
Supervisory Mechanism (SSM). The ECB will assume its new banking
supervision responsibilities in November 2014, 12 months after SSM Regulation
creating the supervisor entered into force. The main objectives of the SSM are
to ensure the safety and soundness of the European banking system and to
increase financial integration and stability in Europe.
The Single Supervisory
Mechanism creates a new system of banking
supervision that includes the national competent authorities of the
participating European Union countries and the ECB. However, is the ECB the one responsable for
the effective and consistent functioning of the SSM, cooperating with the national competent authorities of
participating EU countries.
The European Central Bank (ECB) has issued several reports about the progress in the implementation of the SSM. The last report of may 2014 assured that the establishment of the SSM governance
structures, including the related organisational rules and arrangements, has
largely been completed. Moreover,
complying with the deadline of 4 May 2014, the SSM Framework Regulation was
adopted by the Governing Council on a proposal of the Supervisory Board and
published on 25 April 2014, together with a Feedback Statement on the outcome
of the consultation and the amendments, which had been introduced. (SSM Quarterly Report 2014 / 2).
Additionally, the
establishment of Joint Supervisory Teams (JSTs), which will be the main
operational structure for the conduct of supervision by the SSM, has been
initiated. It is also reported that there has been significant progress in the
conduct of the comprehensive assessment, which required the selection of portfolios subject to
examination in the asset quality review. The details of the scenario of the
stress test, as decided by the European Banking Authority (EBA), and prepared
in cooperation with the European Systemic Risk Board (ESRB) and the ECB, were
released on 29 April 2014. The Supervisory Board approved a Supervisory
Reporting Manual, which will provide the data framework to support the conduct
of supervision. (SSM Quarterly Report 2014 / 2)
See European Central Bank, SSM Quarterly Report: Progress in the Operational Implementation of the Single Supervisory
Mechanism Regulation 2/2014 http://www.ecb.europa.eu/pub/pdf/other/ssmqr20142en.pdf
