BRATISLAVA, September 27, (WEBNOVINY) — The transfer of control over banking supervision into the hands of the European Central Bank (ECB) must be associated with confidence in the development in the banking sectors of other countries. That is what the Slovak Finance Minister Peter Kazimir believes. He says that in addition to unification of banking supervision, creating a banking union counts with recapitalization of banks and a uniform deposit protection scheme, however, this requires clarity about development in banks in all participating countries.
„We agree with concentration of supervisory powers in the hands of the ECB, but we believe that this scenario cannot be achieved without clarifying the challenges of recapitalization and deposit protection as such. We can hardly allow taking over responsibility for recapitalization of banks and deposit insurance in the state of the sector that has not been clearly resolved,“ Kazimir said at Thursday’s news conference.
Governor of the National Bank of Slovakia (NBS) and member of the Governing Council of the ECB Josef Makuch said last week that a shift of supervisory powers as such from Slovakia to the ECB would reduce its quality and effectiveness. „I do not have a feeling that there is some effort to carry out specifically these tasks from the level of Frankfurt,“ said Makuch.
The European Commission has put forward proposals in September, which should lead to the creation of a single mechanism of supervision over banks in the euro area. According to the Commission, this is a significant step towards the strengthening of economic and monetary union.
National supervisors should continue to play an important role in the performance of day to day supervision and in developing and implementing decisions of the ECB. The Commission also proposed that the European Banking Authority (EBA) draws up a unified set of guidelines for supervision in order to maintain integrity of the single market and to ensure consistency in the implementation of banking supervision in all 27 EU countries.
The Commission invites the Council and the European Parliament to adopt the proposed regulations by the end of 2012 along with three other elements of an integrated banking union. These include a unified set of rules on capital requirements, harmonized systems of deposit insurance, and a single European framework for bank recovery and resolution of their problems.
SITA