Barnier: “We must find a link with the EBA”
By Manon Malhère | Tuesday 10 July 2012
The relationship between the future integrated banking supervisor and the European Banking Authority (EBA) is one of the politically difficult issues, Internal Market Commissioner Michel Barnier told members of the European Parliament’s Committee on Economic and Monetary Affairs (ECON), on 9 July. The debate concerned the legislative proposal on the establishment of a single supervision mechanism for banks, which Barnier said the European Commission will likely present in September.
This follows a request to that effect by the 17 eurozone member states at the 28-29 June European Council. They asked the Commission to present proposals on the basis of Article 127(6) TFEU, which requires unanimity by the 27 member states and which involves the European Central Bank (ECB).
For the MEPs, this raises many questions: Elisa Ferreira (S&D, Portugal) asked, for instance, which banks will be concerned, and whether this supervision will be limited to the eurozone. Philippe Lamberts (Greens-EFA, Belgium) asked: “Does it make sense to do it for the eurozone but not for the others?” - all the while highlighting the democratic responsibility of this supervisor. This issue was also raised by the Sharon Bowles (ALDE, UK).
“In the end, for operational reasons, the European Council has chosen to put the ECB at the centre,” said Barnier, who had little choice but to accept this rather more intergovernmental approach. But “we must find a link with the EBA” to associate non-eurozone countries.
And the issue of what changes will be necessary in the EBA regulation is quite a pressing one. The EBA is under the Commission’s responsibility and currently has very limited supervisory competences - its competences are more regulatory. This would be a tricky exercise.
Barnier has outlined very complex issues, including how the democratic responsibility of this integrated supervisor will be ensured, the type of integration it will have (superposition or substitution), and the banks concerned. These are some of the many political, technical and legal issues that will have to be resolved by September.
On top of this, there is the broader problem of how this single supervision will be worked out around the two other axes of a banking union - deposit guarantee schemes and banking resolution systems.
The finance ministers of the eurozone, who met at the end of the day on 9 July, welcomed the Commission’s intention to present proposals for a single supervisory mechanism involving the ECB. “We expect the Council to consider these proposals as a matter of urgency by the end of 2012,” they said in their declaration.