11.11.2009   

EN

Official Journal of the European Union

C 270/1

1.

The ECB broadly supports the regulation and decision proposed by the Commission, which are aimed at establishing a new body responsible for the conduct of macro-prudential oversight in the EU, namely the ESRB. In the ECB’s view, the recent financial crisis has demonstrated the need to strengthen the macro-prudential approach to regulation and supervision of the financial system as a whole. It has also demonstrated the need to assess the various sources of systemic risk and their consequences for the financial system in a comprehensive and timely manner. The ESRB, by identifying and assessing systemic risks, by issuing early warnings and recommendations where such risks are significant and by monitoring the follow-up, can significantly contribute to the stability of the EU financial system as a whole.

2.

The Ecofin Council on 9 June 2009 concluded that the ‘ECB should provide analytical, statistical, administrative and logistical support to the ESRB, also drawing on technical advice from national central banks and supervisors’. This followed the recommendations of the report by the High-Level Group on Financial Supervision in the EU chaired by Jacques de Larosière of 25 February 2009 and the Communication from the Commission of 27 May 2009, which suggests that the ECB should ensure the Secretariat of the ESRB. On 18 and 19 June, the European Council noted that the Communication and the Ecofin conclusions set the way forward for the establishment of a new framework for macro- and micro-prudential supervision and supported the creation of the ESRB.

3.

The ECB has decided that it stands ready to ensure the Secretariat of the ESRB and to support the ESRB and suggests referring to this in a recital of the proposed regulation. The ECB is prepared to bring to the benefit of the ESRB, with the participation of all the members of the ECB’s General Council, the macroeconomic, financial and monetary expertise of all EU central banks. This contribution will be underpinned by the activities of the ECB and ESCB in the areas of financial stability monitoring, macroeconomic analysis, collection of statistical information, and by the overall synergies in terms of expertise, resources and infrastructure in the context of existing central banking activities in the EU.

4.

The involvement of the ECB and ESCB in the ESRB will not alter the primary objective of the ESCB under Article 105(1) of the Treaty, which is to maintain price stability. In this respect, the ECB notes that its supporting activities for the ESRB will neither affect the ECB’s institutional, functional and financial independence nor the the ESCB’s performance of its tasks under the Treaty and the Statute of the European System of Central Banks and of the European Central Bank (hereinafter the Statute of the ESCB), in particular its financial stability and oversight tasks (4).

5.

In the area of statistics, the ECB is prepared to provide the necessary information to the ESRB relating to the macroeconomic and macro-financial environment and has the necessary expertise to do so. This includes in particular information on market conditions and market infrastructures. Micro-prudential information will be provided by the three new European supervisory authorities.

6.

Regarding the procedure for the issuance and follow-up of risk warnings and recommendations, the ECB fully supports the proposed regulation (5), which provides that the ESRB risk warnings and recommendations will be directly transmitted to the respective addressees, with parallel transmission to the Ecofin Council. Changes to these provisions that would lead to an ‘indirect route’ for the transmission of risk warnings and recommendations would undermine the effectiveness and timeliness of the recommendations as well as the independence and credibility of the ESRB. Moreover, it is important that the procedures relating to the communication of the ESRB with other EU institutions and committees will not hinder the effective and timely fulfilment of the ESRB’s tasks.

7.

Regarding the organisational aspects of the ESRB, the ECB considers it particularly important that the composition of the ESRB’s Steering Committee adequately reflects that of the ESRB’s General Board. On the latter, 29 voting members will be central bankers, while the four other voting members will be a member of the Commission and the chairs of the three new European supervisory authorities. It is essential that the composition of the Steering Committee reflects that of the General Board in order to ensure that the Committee is representative of the Board, whose meetings it is meant to prepare. Therefore, the inclusion of five central bank members (in addition to the chair and vice-chair of the ESRB) alongside the above four other voting members is a minimum threshold to ensure such an appropriate balance together with sufficient representation of the euro area and non-euro area national central banks. Accordingly, the ECB strongly supports the Commission’s proposal that seven of the Steering Committee members will be drawn from the ECB’s General Council (6). However, as the composition of the euro area will change with time, it would not be advisable to lay down in a legal act a specific, immutable allocation of seats between euro area and non-euro area central banks. Lastly, the ECB supports the Commission’s approach under which only the chair of the ESRB gives directions to the head of the secretariat (7).

8.

The chair and the vice-chair of the ESRB’s General Board should be elected on the basis of the same procedures and by the same group of voting members, as the vice-chair should be fully able to deputise for the chair, if necessary. Consequently, the vice-chair should also be elected, as stated in the Commission’s proposal, by and from the members of the General Board who are also members of the General Council of the ECB. Different procedures for the election of the chair and vice-chair would add undue complications and could give the unwarranted impression that they represent different groups within the ESRB.

9.

Regarding the composition of the ESRB’s General Board, the ECB supports the Commission’s proposal that the president and vice-president of the ECB be voting members of the ESRB’s General Board. This is in line with the principle that the ECB’s General Council provides the basis for the voting members of the General Board (8). Moreover, the inclusion of the vice-president of the ECB would be in line with the European Council Presidency Conclusions of 18 and 19 June 2009 according to which the vice-president could vote in the election of the chair of the ESRB as a member of the General Council of the ECB. Indeed, if he were not a member of the ESRB’s General Board, the vice-president would be prevented from voting in this election.

10.

The ESRB is a Community body, whose tasks concern the EU financial system and include making recommendations and taking appropriate actions in order to address systemic risks and safeguard the system’s stability and whose members are drawn from all EU Member States. However, in view of the systemic importance of certain European non-EU countries for the EU financial system, it may be considered appropriate to invite representatives from these countries to attend some of the ESRB’s meetings and/or the technical committees as observers when relevant issues are being discussed.