/

ERM Glossary: Single Supervisory Mechanism

[this page | pdf | references | back links | custom searches]

The Single Supervisory Mechanism (SSM) is the name for the mechanism that has given the European Central Bank (ECB) a supervisory role monitoring the financial stability of banks in participating states. With effect from 4 November 2014, Eurozone states are obliged to participate in the SSM. Other member states of the European Union can voluntarily participate (but at the time of writing have typically not done so).

 

Under the SSM, a common bank supervision is applied that involves both national supervisors and the ECB, although final authority (for core supervisory responsibilities) rests with the ECB. In practice, this means that ‘significant’ banks (suitably defined) are supervised directly by the ECB but smaller banks covered by the SSM continue to be directly monitored by their national supervisors. Non-core supervisory activities (e.g. anti-money laundering and consumer protection) remain within the scope of the relevant national authority.

 


NAVIGATION LINKS
Contents | Prev | Next


Desktop view | Switch to Mobile