The ECB directly supervises the significant banks in the euro area. To do so, we work together with the national supervisory authorities within the Single Supervisory Mechanism.
The less-significant banks are supervised by the national supervisory authorities while the ECB ensures a consistent approach across Europe.
Working together under the Single Supervisory Mechanism, the ECB and the national supervisors aim to
Microprudential tools concentrate on challenging and testing the risks of individual banks. In this way, they contribute to a safe banking system in Europe.
The ECB has the power to:
Macroprudential supervision refers to the overall approach taken to ensure the stability of Europe’s financial system by limiting the build-up of aggregate risk within the system.
The ECB can: