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Section C
TABLE 13
A comparison: ECB (as a supervisory authority), EBA and ESRB
ECB
EBA
ESRB
Tasks
micro-prudential
supervision of credit
institutions (SSM
Regulation, Articles 4
and 5)
various (EBA
Regulation, Articles
8-9), but
not a
supervisory authority
macro-prudential
oversight of the
Ànancial system (ESRB
Regulation, Article 3,
paragraph 1)
Seat
Frankfurt
London
Frankfurt
5. Creation of ‘Chinese walls’
5.1 Introductory remarks
Although the safeguarding of Ànancial stability has historically been a major
objective of central banks and the micro-prudential supervision over credit in-
stitutions a main competence and task thereof (with the exception of a few
central European countries), an ever increasing number of countries around
the world have assigned this supervision since the 1980s to independent au-
thorities other than the central bank.
462
The rationale behind this development
was that the exercise of supervisory powers by the central bank may give rise
to conÁicts of interest that would undermine the efÀcient achievement of its
monetary policy objectives (not least in terms of maintaining price stability).
463
However, this trend has tended to be reversed in the aftermath of the recent
(2007-2009) international Ànancial crisis as a result of the relevant failures at-
tributed to independent supervisory authorities in many states all over the
world.
464
In addition to the Bank of England since 1 April 2013,
465
the ECB has
462. See on this indicatively
Herring and Carmassi (2008)
, with extensive further referenc-
es, and
Central Bank Governance Group (2011)
. On the trend towards integrating sec-
toral Ànancial supervisory authorities (for banking, capital markets and insurance/rein-
surance) into a single body, see
Hadjiemmanuil (2004)
,
Wymeersch (2006)
(speciÀcally
in Europe),
Filipova (2007)
,
Group of Thirty (2008)
, and
Seelig and Novoa (2009)
.
463. For an overview of the debate on whether it is appropriate for a central bank, as a
monetary authority, to also perform micro-prudential banking supervision tasks (‘sepa-
ration of monetary and supervisory tasks of central banks’), see the seminal paper by
Goodhart and Schoenmaker (1993)
, as well as
Haubrich (1996)
,
Di Noia and Di Gior-
gio (1999)
,
Goodhart (2000)
,
Gianviti (2010)
, pp. 480-482 and
Beck and Gros (2013)
.
464. See
Davies and Green (2010)
, pp. 187-213.
465. Under the UK Financial Services Act 2012, the Prudential Regulation Authority (‘PRA’)
was established as a subsidiary of the Bank of England, responsible for the micro-pru-
dential supervision of banks, building societies and credit unions, insurers and major