Frank Elderson, Vice-President of the Supervisory Board of the European Central Bank (ECB), participated in the 17th FMA conference on “Europe’s Financial Future,” where he emphasized the need for efficient and simplified European banking supervision.
According to him, simplification and effective supervision are not contradictory but mutually reinforcing. To make dialogue with banks simpler, supervision must focus more on material risks, be more efficient, and lead to concrete and swift improvements of identified weaknesses.
This focus reduces unnecessary complexity for banks: discussions become more targeted and the monitoring of corrective measures more precise, freeing up time to address the root causes of major weaknesses. Less impactful issues are handled proportionately.
The ECB requires that all identified weaknesses be corrected quickly and sustainably. For minor weaknesses, banks only need to confirm that necessary measures have been taken, without additional documentation. Conversely, major weaknesses that are not addressed promptly do not contribute to the resilience of the banking system.
