Monday

25th Jul 2016

MEPs demand ECB transparency in bank union talks

  • EU officials are on the verge of a banking union deal (Photo: Valentina Pop)

EU officials are expecting to sketch out a deal within the coming weeks on two regulations that will govern the single supervisory mechanism (SSM) to be co-ordinated by the European Central Bank (ECB).

A parliament official involved in the negotiations on the banking union files told EUobserver that "everything has been discussed and we know where the agreement is moving to."

Dear EUobserver reader

Subscribe now for unrestricted access to EUobserver.

Sign up for 30 days' free trial, no obligation. Full subscription only 15 € / month or 150 € / year.

  1. Unlimited access on desktop and mobile
  2. All premium articles, analysis, commentary and investigations
  3. EUobserver archives

EUobserver is the only independent news media covering EU affairs in Brussels and all 28 member states.

♡ We value your support.

If you already have an account click here to login.

While officials representing governments are reluctant to open up the texts in negotiations with parliament, MEPs are set to secure amendments preventing officials involved in the supervision regime from being able to leave for jobs in the banking sector.

They also want to guard against conflicts of interest by preventing members of the SSM's steering committee from also having a mandate as a national regulator.

Parliament is also pushing for closer control of the SSM's budget and is demanding the power to approve the chair of the SSM, using a method similar to the Congressional confirmation hearings for nominees to the board of the US Federal Reserve.

Although MEPs only have consultative powers over the ECB regulation, they have threatened to block new rules for the European Banking Authority, on which they have equal legislative powers with ministers, if member states refuse to negotiate.

The parliament's demands come amid concern that the ECB's new role supervising the eurozone banking sector will create conflicts of interest with its monetary policy arm.

Critics claim that the European Systemic Risk Board (ESRB), set up in 2011 to act as a watchdog scrutinising trends in Europe's financial sector, already gives the bank a role in macro-economic supervision that could compromise its monetary policy functions.

Jana Mittermaier, director of pro-transparency NGO Transparency International, told this website that “ECB supervision is supposed to be a fresh start for the eurozone. This means preventing the conflicts of interest, group think and regulatory capture that contributed to the current crisis. If the Council is serious about addressing these risks, regulating the revolving door between supervisors and supervised is crucial.”

Although EU leaders initially set themselves a December 2012 deadline to finalise the first plank of a eurozone banking union, the dates for implementing the rules have slipped. The current timetable now envisages the ECB assuming oversight over the eurozone banking sector from spring 2014.

The European Commission is set to follow up the supervisory framework with legislation later this year for a single resolution mechanism to wind up failing banks and measures to harmonise national deposit guarantee schemes to protect savers.

EU to tweak rules on Chinese 'dumping'

The EU Commission has tried to fudge the issue of whether China is a “market economy” amid efforts to protect European industry from cheap exports.

Court ruling puts Renzi bank plan in doubt

EU court ruling on bank bailouts has raised the likelihood of a political embarrassment for Renzi, months before a referendum puts his future and, potentially, Italy’s euro future on the line.

Stakeholders' Highlights

  1. Belgrade Security ForumMigration, Security and Solidarity within Global Disorder: Academic Event Agenda for 2016
  2. GoogleHow Google Fights Piracy: Creating Value While Fighting Piracy
  3. EJC"My Visit to Israel" - Opinion by MEP Lopez Aguilar, Chair of the EP Working Group on Antisemitism
  4. World VisionChildren Migrating, Out of School and at Work as Hunger Deepens in Southern Africa
  5. European Healthy Lifestyle AllianceStand-Up (and Exercise) to Prevent Chronic Diseases
  6. Centre Maurits CoppietersLaunches a Real-time News Hub Specialised in EU Stakeholders
  7. Dialogue PlatformFethullah Gulen Calls for International Probe Into Turkey Coup Allegations
  8. GoogleEU-US Privacy Shield: Restoring Faith in Data Flows and Transatlantic Relations
  9. World VisionWorld Leaders & Youth Advocates Launch Partnership to End Violence Vs. Children
  10. Counter BalanceReport: Institutionalised Corruption in Romania's Third Largest Company
  11. Access NowEuropol Supports Encryption. We Can Relax Now… Right?
  12. GoogleLearn about Google's projects across Europe on Twitter @GoogleBrussels