Eurozone Banks Wake Up To A New Supervisor. What’s Next?

The Single Supervisory Mechanism (SSM) formally opens for business today. For months, supervisors and banks have been preparing for the transfer of supervisory responsibilities to the European Central Bank (ECB). Yet the 4 November milestone is just the start of a much longer, possibly testing journey for all involved.

Over time, the SSM will change the terms of engagement between supervisors and banks. It will introduce higher supervisory standards than some banks have been used to in the past; greater standardisation of approach, and a change in perspective (so that different issues might come to the fore of the supervisory relationship).

Related insight:

Meeting the challenge of the SSM | How banks should get ready for the new regime.

Banks need to seize the initiative, recognise the raised expectations and take the opportunity to make a fresh start in the supervisory sphere. The first 12 months of the SSM will be key for establishing the priorities and approach of the SSM. Through a careful analysis of the SSM supervisory objectives, the experience of banks during the comprehensive assessment, and...