Speaking after the meeting of the Governing Council of the European Central Bank on 6 July, ECB President Wim Duisenberg said the bank had decided that a report on ‘mergers and acquisitions involving the EU banking industry’ should be prepared for publication in the autumn.
The Governing Council of the ECB, he said, ‘is well aware that the current process of consolidation is no longer confined to small and medium-sized banks - as it was in the past - but that now it also covers the larger banks at the national level.’ Cross-border mergers and alliances are on the increase, he said.
The ECB welcomed consolidation in European banking ‘in general since it allows efficiency gains to be achieved in the banking sector.’ But the July 6 statement pointed out also that consolidation ‘affects the competitive environment in which banks operate, as well as their risk profile.’ For that reason, continual monitoring of EU banking consolidation was necessary.
Duisenberg said the euro had an important role ‘as a factor encouraging this process of consolidation via further integration of money and capital markets’. But he accepted that the ECB had ‘has only a very limited mandate in the area of banking supervision’.
He added, ‘It is our view that a close connection between banking supervision and central banking is of the essence, both for supervisors and for the central banks. So that is a close connection. I am not saying that it always has to be done by central banks. But the very close connection, as I have said, is regarded as very important for both policies, for supervisory policy and for monetary policy.’
Asked about a centralised role in financial supervision by the ECB, Duisenberg said, ‘We have no interest in doing that. We are perfectly happy with leaving actual supervision in national hands. And the ECB, or the Eurosystem, is not part of a movement to ‘europeanise’ or centralise banking supervision or other ways of supervision.’ (see ‘Scrap Single Regulator’ page 4). |
