ECB bolsters partnership with 6 EU nations

The European Central Bank (ECB) has entered into a multilateral Memorandum of Understanding (MoU) with the national regulatory bodies of six European Union (EU) member states that are not currently under the purview of European banking supervision. This agreement will establish a framework for the Czech Republic, Denmark, Hungary, Poland, Romania, and Sweden to share information and coordinate supervisory activities related to banking.

This MoU aims to further strengthen supervisory cooperation at the European level and builds upon the already existing culture of collaboration between the ECB and EU member states not participating in European banking supervision, as demonstrated through the work of the European Banking Authority. The MoU provides a framework for member states to regularly share information on supervisory matters related to cross-border supervised institutions and supervisory methodologies, approaches, and priorities.

Additionally, the MoU encourages the ECB and national regulatory bodies to inform one another of planned measures that may be of relevance to the other authority’s tasks, which may help to reduce fragmentation risks in European banking markets during times of stress.

The ECB is particularly interested in enhancing cooperation with the national regulatory bodies of member states not participating in European banking supervision due to the significant interconnectedness of their banking sectors. Some banks supervised by the ECB have subsidiaries or substantial credit exposures in these member states and conduct a significant portion of their activities there. Conversely, some institutions based in non-participating member states also have a significant presence in jurisdictions supervised by European banking supervision.

The MoU is being executed in accordance with the legal requirement for the ECB and the competent authorities of the European Union to sign a supervisory MoU, as outlined in Article 3(6) of the SSM Regulation.

The post ECB bolsters partnership with 6 EU nations appeared first on PAN Finance.

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