EBA欧洲银行-EBA-Opinion-on-ESAs-review-28EBA-Op-2017-0829_6页_182kb

EBA Opinion on Public Consultation on the Operation of the ESAs (EBA/Op/2017/08)

Introduction and Legal Basis

The European Banking Authority (EBA) issued an opinion in response to the European Commission's public consultation on the operation of the European Supervisory Authorities (ESAs), launched on 21 March 2017. This consultation aimed to assess the effectiveness, efficiency, and governance of the ESAs, including the EBA, with a view to possible legislative changes. The EBA's competence to issue this opinion is based on Article 34(1) of Regulation (EU) No 1093/2010, and the Board of Supervisors adopted it in accordance with Article 14(5) of its Rules of Procedure.

Core Content and Main Points

1. Welcome to the Consultation

• The EBA acknowledges the Commission's initiative to review the operation of the ESAs.
• It believes that the current regulatory framework has made significant progress in promoting a stronger and more integrated regulatory environment.
• The EBA supports the evaluation of areas where its effectiveness and efficiency can be enhanced.

2. Tasks and Powers of the EBA

• The EBA has already expressed views on the improvement of the decision-making framework for supervisory reporting and own funds.
• It opposes reducing the role of technical standards in favor of guidelines and recommendations, as this could undermine harmonization.
• A streamlined endorsement process is recommended, with specific delegations to the EBA in its founding regulation or through targeted decision-making in the CRD/CRR.

3. Governance and Funding

• The EBA believes that the current governance structure has performed well but could be reconsidered in areas where complexity or lack of independence is an issue (e.g., mediation, breach of Union law).
• It supports the idea of an independent budget line in the EU budget or direct industry funding to alleviate budget constraints, which have hindered its ability to fulfill key responsibilities.

4. Supervisory Convergence

• The EBA supports the peer review process but suggests improvements such as:
  • Additional focused reviews on a limited number of competent authorities.
  • On-site visits and the obligation to issue opinions on all areas within its scope.
• A methodology and program for conducting these reviews should be established.
• Reports based on each review should highlight good practices and recommendations for improvement.
• The EBA's founding regulation should be updated to reflect the broader scope of consumer protection and payments legislation.

5. International Aspects

• The EBA proposes clarifying its role in equivalence assessments of third countries, including:
  • Initial assessments and continuous monitoring.
  • Monitoring of regulatory, supervisory, and market developments in third countries.
  • Supervisory cooperation with third country counterparts.
• It emphasizes the need for EU bodies to be recognized at international standard-setting tables like BCBS or FSB.

6. Reporting Requirements

• The EBA agrees that streamlined and consistent reporting is essential for the Single Rulebook.
• It opposes the suggestion of more detailed and technical guidelines, as this could compromise harmonization.
• It recommends specific delegations to the EBA to make decisions of general application, ensuring timely and uniform technical requirements.
• The EBA highlights the delays in the endorsement process, which create uncertainty and disrupt planning for financial institutions.
• It suggests improving coordination of official sector reporting across the EU, inspired by the U.S. FFIEC model.

7. Own Funds

• The EBA emphasizes the importance of own funds in prudential policy and has leveraged its existing legal powers effectively.
• It advocates for explicit legal basis for its role in ensuring the consistency of own funds instruments across the EU.
• A mandatory prior consultation of the EBA would help eliminate uncertainties and enhance the quality and harmonization of capital instruments.

Key Recommendations

• Clarify the EBA's role in the Single Rulebook and its powers in consumer protection and payments.
• Streamline the endorsement process for reporting, disclosure, and benchmarking requirements.
• Establish an independent budget line or direct industry funding to improve financial resources.
• Enhance the peer review process with focused reviews, on-site visits, and comprehensive reporting.
• Reconsider the governance structure of the ESAs, especially in light of the Banking Union, to avoid artificial disconnects between regulatory and supervisory functions.
• Retain the sectoral structure of the ESAs but consider streamlining the Joint Committee's governance processes.
• Maintain EU recognition at international standard-setting bodies.

Conclusion

The EBA's opinion underscores the importance of a strong, harmonized, and efficient regulatory and supervisory framework in the EU. It calls for a balanced approach to reform, focusing on areas where current structures may hinder effectiveness, while preserving the independence and technical expertise of the EBA.