The ECB together with the national supervisors carries out financial health checks of the banks it supervises directly. These comprehensive assessments help to ensure that the banks are adequately capitalised and can withstand possible financial shocks.
Comprehensive assessments are carried out either regularly or on an ad hoc basis:
|Transparency||enhance the quality of information available on the condition of banks|
|Repair||identify problems and implement necessary corrective actions|
|Confidence building||assure all stakeholders that banks are fundamentally sound and trustworthy|
The assessment usually comprises two main pillars:
The methodology used is set out in the following documents:
Each comprehensive assessment concludes with an aggregate disclosure of the overall outcomes as well as bank-level data.
Supervisors address the identified risks in their day-to-day work. In particular, results are factored into the ongoing assessment of banks’ risks, their governance arrangements and their capital and liquidity situation as part of the Supervisory Review and Evaluation Process (SREP).2015