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An integrated system for banking supervision in the Banking Union

Dates:
  • Mon 24 Feb 2020 11.00 - 13.00
  Add to Calendar 2020-02-24 11:00 2020-02-24 13:00 Europe/Paris An integrated system for banking supervision in the Banking Union

The European Central Bank (ECB) has been conferred exclusive competence in banking

supervision and enjoys significant powers in leading banking supervision within the Single

Supervisory Mechanism (SSM) in the euro area. Such leeway for action is essential for efficient

decision-making and steering ‘ongoing’ supervision; while the national competent authorities

act in a decentralised implementation framework. Yet the SSM as a system is not fully

integrated – institutionally, administratively, in its still evolving governance – and therefore

cannot be considered single despite its name. The SSM operates nonetheless within shared

and interlocked legal orders, exhibiting some features of cooperative federalism but

remaining subject to evolving centripetal and centrifugal forces. An integrated system for

banking supervision has an institutional and substantive dimension. I examine the SSM

supervisory architecture, institutional organisation, and its governance with a legal and

contextual approach. The position of the ECB is outstanding in leading direct banking

supervision and in its oversight over the system, including an expanding normative power.

Nonetheless, the preparation, implementation and execution of supervision may be exercised

in different instances, including through joint structures.

In a context of an unharmonized regulatory framework and banking markets fragmented

along national lines, how can banking supervision be achieved efficiently in the Banking

Union? I define the concept of efficiency as including qualitative and adequacy aspects.

Qualitatively, banking supervision should be consistent, uniform, and harmonised in the

system. Adequate supervision should attain the SSM objectives through the use of (limited)

resources, proportionally. I conclude that applying proportionality and sincere cooperation,

general principles of law, and a governing principle of consistency should sustain the integrity

of the system. The SSM must keep and develop cooperative and incentivising mechanisms to

pursue its objectives – banks’ safety and soundness, the stability of the financial system – in

the interest of the Union as whole.

Sala degli Stemmi - Villa Salviati- Castle DD/MM/YYYY
  Sala degli Stemmi - Villa Salviati- Castle

The European Central Bank (ECB) has been conferred exclusive competence in banking

supervision and enjoys significant powers in leading banking supervision within the Single

Supervisory Mechanism (SSM) in the euro area. Such leeway for action is essential for efficient

decision-making and steering ‘ongoing’ supervision; while the national competent authorities

act in a decentralised implementation framework. Yet the SSM as a system is not fully

integrated – institutionally, administratively, in its still evolving governance – and therefore

cannot be considered single despite its name. The SSM operates nonetheless within shared

and interlocked legal orders, exhibiting some features of cooperative federalism but

remaining subject to evolving centripetal and centrifugal forces. An integrated system for

banking supervision has an institutional and substantive dimension. I examine the SSM

supervisory architecture, institutional organisation, and its governance with a legal and

contextual approach. The position of the ECB is outstanding in leading direct banking

supervision and in its oversight over the system, including an expanding normative power.

Nonetheless, the preparation, implementation and execution of supervision may be exercised

in different instances, including through joint structures.

In a context of an unharmonized regulatory framework and banking markets fragmented

along national lines, how can banking supervision be achieved efficiently in the Banking

Union? I define the concept of efficiency as including qualitative and adequacy aspects.

Qualitatively, banking supervision should be consistent, uniform, and harmonised in the

system. Adequate supervision should attain the SSM objectives through the use of (limited)

resources, proportionally. I conclude that applying proportionality and sincere cooperation,

general principles of law, and a governing principle of consistency should sustain the integrity

of the system. The SSM must keep and develop cooperative and incentivising mechanisms to

pursue its objectives – banks’ safety and soundness, the stability of the financial system – in

the interest of the Union as whole.


Location:
Sala degli Stemmi - Villa Salviati- Castle

Affiliation:
Department of Law

Type:
Thesis defence

Defendant:
Christy Petit (EUI - Law)

Supervisor:
Prof. Stefan Grundmann (EUI - Law Department)

Co-Supervisor:
Prof. Régis Bismuth (Sciences Po Paris)

Contact:
Claudia de Concini (EUI - Law) - Send a mail

Examiner:
Dr. Pedro Teixeira (European Central Bank)
Prof. Joanne Scott (EUI - Law Department)

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