Supervisory policy documents
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When exercising our tasks within the Supervisory legal framework, we use different tools and instruments to communicate our supervisory approach, expectations, analytical assumptions and methodologies, as well as good practices we observe.
| Publication type | Purpose | Nature of content | Supervisory role |
|---|---|---|---|
| Guide | Explain how the ECB conducts supervision and what it expects | Criteria, processes, approaches and supervisory expectations – may contain examples of good practice | Forward-looking, non-binding guidance |
| Letter | Communicate supervisory expectations on specific topics or emerging concerns directly and quickly | Focused messages on specific risks or priorities | Targeted supervisory communication |
| Methodology | Explain how assessments or analyses are carried out in a supervisory area | Technical frameworks, methods and processes | Transparency and accountability |
| Report | Highlight and focus on effective practices observed in banks in a supervisory area Present results of a targeted supervisory review |
Illustrative examples of sound practices and/or findings and analysis from a specific exercise | Benchmarking and learning, ex post analytical reporting |
Guides
Supervisory guides are developed and published when the ECB intends to communicate supervisory expectations to the banking industry.
These expectations are non-binding statements issued by the ECB to help banks apply the relevant regulatory framework. They aim to enhance banks’ safety and soundness by promoting appropriate risk management and adequate risk coverage, and they serve as a basis for supervisory dialogue. The ECB’s objective when issuing guides is to foster transparency and make our supervisory actions more predictable.
Supervisory guides may provide transparency on:
- the processes applied by the ECB in carrying out its supervisory tasks, to the extent that these processes are relevant for banks or the public when they need to interact with the ECB (for example as concerns licensing, internal models or risk management)
- how the ECB intends to apply the relevant provisions of Union law (for example, on key supervisory or market-wide topics, such as the treatment of non-performing loans or bank governance), in light of the applicable European Banking Authority Guidelines and following the definitive interpretation given by the Court of Justice of the European Union, where available
- what the ECB expects from supervised banks when applying those provisions
Supervisory guides do not establish binding obligations; these are solely created by the legislator. However, it is common for supervisory guides to reference binding legislative obligations. The purpose of this approach is to bring together in a single document the relevant rules and the way in which the ECB intends to apply those rules when exercising its supervisory tasks, making it easier for readers to access the relevant framework.
The supervisory expectations included in ECB guides are also not binding. Rather, they can be considered as a starting point for interaction and dialogue with banks. This dialogue is always conducted on a case-by-case basis and in line with the principle of proportionality. Therefore, the guides do not exclude the possibility of a different approach in specific cases.
Letters
Supervisory letters may be addressed to the management of supervised banks and published on our website when the ECB intends to convey non-binding supervisory guidance or expectations on specific limited issues and to clarify supervisory views, processes or concerns around these issues. This often occurs in response to emerging risks or market developments which necessitate swift guidance.
Methodologies
Public methodologies may be used to explain the methods, frameworks and technical approaches used by the ECB, particularly in areas such as supervisory assessments (e.g. Supervisory Review and Evaluation Process (SREP) methodology), statistical compilation and data production. They describe how assessments, data production or analyses are carried out, and explain the technical basis underpinning ECB outputs or supervisory processes. They do not include supervisory expectations.
Other means of communication
The ECB and its leadership may inform, explain and amplify policy views, supervisory thinking and context by various means (such as speeches, interviews, blog posts, newsletters, press releases or other publications). These types of communication are not intended to express new supervisory expectations or guidance but may refer to existing ones and provide additional explanations and context.