Kerstin af Jochnick, Member of the ECB’s Supervisory Board, looks back at the road travelled by banks and supervisors during the pandemic – and is confident that the resoluteness shown so far will stand European banks in good stead for the challenges of the year ahead.
The pandemic has put banks’ recovery plans to the test. But to weather a system-wide storm of this kind, banks need to improve crucial parts of their recovery plans, as the ECB found in its most recent benchmarking exercise.
Governments and supervisory authorities took extraordinary measures in response to the pandemic. Find out how decisions were made in times of uncertainty and what considerations will drive any future changes or adjustments.
How does market competition influence the terms and conditions under which smaller banks grant loans? Does banks’ loan pricing really account for the inherent risks? European supervisors found some concerning vulnerabilities.
The ECB and national supervisors have created an action plan for digital transformation. Discover what this means in practice, what challenges remain and why knowledge sharing is crucial to making the transformation a success.
Did the pragmatic SREP adequately scrutinise banks? Have a look at the results of the assessment to see why credit risk, internal governance and low bank profitability will remain high on the supervisory agenda for 2021.
The leverage ratio rose to 5.63% in Q3 2020, from 5.33% in Q2. This was due to a drop in total exposure from €25 trillion in Q2 2020 to €23.6 trillion in Q3, partly owing to the exclusion of central bank exposures from the ratio.
… that we will be publishing all of the Memoranda of Understanding that ECB Banking Supervision has negotiated with supervisory and market authorities worldwide? Memoranda of Understanding (MoUs) are cooperation frameworks that help coordinate the supervision of internationally active banks. When signing an MoU, the ECB and authorities inside and outside the EU agree on principles for cooperation and information-sharing. More than 20 MoUs have been signed since the start of European banking supervision. Brexit also required a new MoU between the ECB and the two UK financial supervisory authorities, which became effective on 1 January 2021.