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The Cypriot Presidency has heeded the EBF call for a Single Supervisor to have exclusive competence over all banks in the eurozone. EBF welcomes the recognition that this is a key starting point towards the more integrated supervision and common practices called for in a Banking Union.
The Cypriot Presidency has also attempted to define more clearly the practical cooperation between the central authority and the national competent authorities. The EBF welcomes the clarification this compromise offers to banks of all sizes. It however stresses that this is only acceptable as long as in the final agreement, the Single Supervisor is still able to decide to exercise directly all relevant supervisory powers for a small or mid-sized bank. Guido Ravoet, Chief Executive of the EBF, remarked: “The ultimate objective must be that all banks in the Eurozone Members and others that opt-in to the SSM fall under the supervision of the European Central Bank.”
Under the Cypriot Presidency provisions, it would appear that smaller or purely domestically active banks may not fall under direct supervision of the ECB from the outset. The EBF notes that national competent authorities will, by contrast, be given the possibility to volunteer such smaller banks into the direct supervision of the Single Supervisor.