While she is credited with shepherding the supervisor creditably through its first five years, her successor will have much to do to build the standing of a young institution whose reputation has been marred by squabbles with eurozone member states.
As well as grappling with cross-border regulation after Brexit, the successful candidate will have to deal with legacies of the eurozone crisis — particularly in Italy, one of the region’s biggest banking markets, where sour loans remain a problem and the SSM’s image has been tarnished by clashes with Rome.
In deciding who should take on those challenges, the central bankers and EU lawmakers in charge of the appointment know nationality will be a factor, as it is with many senior EU positions. Several candidates could leave the race if governments decide political capital would be better spent on securing other senior jobs — not least the ECB presidency when Mario Draghi’s term ends next year.
Ms Nouy has sought to level the playing field by imposing the same standards on banks around the region. But with member states often arguing that the SSM ignores the quirks of each country’s banking systems, harmonisation remains a work in progress.
Perhaps nowhere has its stance been so fiercely criticised as in Italy, where senior banking executives have declared Ms Nouy “biased”, “a technocrat with no understanding of banking” and even “mad” because of the SSM’s focus on the country’s bad loans.
“The SSM’s reputation is mixed in the sense that they are seen as not recognising how banking works and want to reverse-engineer a certain result without thinking of how that is going to affect a bank’s ability to make money in the longer term,” said Marco Mazzucchelli, a senior European banker who was a member of a European Commission group charged with suggesting structural reform of the eurozone banking system in the wake of the crisis.
Choosing a successor to Ms Nouy provides an opportunity to please Rome, since two Italians are among the favourites. One is Andrea Enria, chair of the European Banking Authority, the EU-wide institution which conducts periodic stress tests of the region’s financial system. The other is Ignazio Angeloni, already a member of the SSM’s supervisory board, who signalled his appetite for the job this year when he set out his vision for what should come next in a speech in London.
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