ECB withheld information on 'flawed' bank supervision

"It is not satisfactory for us," Kevin Cardiff, a member of the court who supervised the report, told journalists in Brussels.

He said that although the ECB was a "very independent institution which has multiple layers of accountability," the scrutiny by the European Parliament and the member states "is enhanced if there is a good, proper, sound, solid audit to provide information to them."

"We see our role as supporting democratic scrutiny," he said, while admitting that under the EU treaty, the auditors cannot examine the ECB's policy-based decision-making.

In their report, the auditors said that the ECB, as a supervisory body for EU banks, "has established a substantial framework for crisis management procedures" but that it was flawed.

They noted that the ECB's process for the assessment of banks' recovery plans was "positive" and that "submission and monitoring procedures are in place," with assessors having access to useful tools.

However, they found "flaws" in the crisis management and recommended better communication and coordination by the ECB with other actors, such as the Single Resolution Board, the EU agency that is in charge of failing banks.



In particular, the auditors said the ECB should provide additional guidance for recovery plans as well as for "failing or likely to fail assessments".

"It's important to see indications of problems at an earlier stage, and engage with them at that point," Cardiff noted.

"We felt there were some difficulties that could impend efficiency, which could be important in a crisis," he said.

But overall, he insisted, the auditors are "not saying there is a major failure in the institution."

The report follows another report on the SRB last month, in which the Court of Auditors said that it was "very much a work in progress" with "still a long way to go."