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A second text approved by the committee would put the European banking watchdog at the head of a single supervisory system. Both texts would increase the supervisory system's democratic accountability. The draft texts will now form the basis for work within the committee over the next month, with a view to formalising an official committee position by the end of November. Once the committee has adopted its position, it will be ready to enter into negotiations with member states to hammer out a deal.
Accountability is key
Both draft reports propose amendments to the Commission proposals to increase the accountability of the banking supervisor. Powers transferred from the national to the EU level must be accompanied by transparency and accountability arrangements, the texts argue.
The European Parliament as well as national parliaments would have the right to hear the supervisory board and the selection of chairpersons would need to be done through open procedures. Most importantly, the European Parliament would have the right to set up a temporary committee of inquiry in the event of contraventions of EU law or maladministration.
Pragmatism for the immediate term
The draft report, prepared by Marianne Thyssen (EPP, BE) on conferring supervisory powers on the ECB, takes a somewhat more pragmatic approach. Under the draft, national supervisors would continue supervising many of their country's banks and the ECB would be able to request direct supervision. National supervisors would therefore be given a larger role with their competences and those reserved for the ECB clearly laid out in the legislation.
The same draft report also points to the need for a realistic timetable for introducing the single supervisory mechanism, to allow time to ensure that the legislation is of high quality and enable the supervisor to prepare adequately.
European Banking Authority in charge
The second draft text, penned by Sven Giegold (Greens, DE), deals with the role of the European Banking Authority in the supervisory structure. It proposes that an EU-wide supervisory system, bringing together eurozone and non-eurozone countries, should have the EBA at the helm. The draft places the EBA in charge of coordinating the EU supervisory structure, with the ECB supervisor and non-eurozone supervisors implementing the single supervisory rulebook to be drafted by EBA. This solution, the draft argues, would be the best way to give eurozone and non-eurozone countries an equal say in the methods chosen to supervise their banks.
The EBA would also be given more "on the ground" powers to allow it to carry out stress tests more effectively and obtain data necessary for its overall policing of the supervisors.