Single Supervisory Mechanism Framework regulation

SUMMARY OF:

Regulation (EU) No 468/2014 — EU mechanism for banking supervision (SSM framework regulation)

SUMMARY

WHAT DOES THIS REGULATION DO?

KEY POINTS

The SSM is one of the 2 pillars of the EU banking union*, alongside the Single Resolution Mechanism* (SRM).

The regulation complements Regulation (EU) No 1024/2013, known as the SSM regulation, which established the SSM. The SSM comprises the ECB and the national competent authorities (NCAs) of the participating EU countries.

Scope: the regulation covers both the practical arrangements for cooperation between the ECB and NCAs and the detailed rules on organisational matters, administrative procedures and sanctions, including:

A key part of the SSM framework regulation is the methodology for the assessment and review of a supervised entity and its classification as significant or less significant, as well as the arrangements resulting from this assessment.

FROM WHEN DOES THIS REGULATION APPLY?

It entered into force on 15 May 2014.

BACKGROUND

KEY TERMS

* Single Supervisory Mechanism: a EU system of banking supervision composed of the ECB and the national competent authorities (NCAs). It gives the ECB direct supervisory powers over banks based in EU countries participating in the SSM.

* EU banking union: established in the wake of the 2008 financial crisis in order to strengthen supervision of EU banks.

* Single Resolution Mechanism: an EU system to deal efficiently with failing banks.

* National designated authorities: the relevant authorities appointed in each of the EU countries that work with the ECB on implementing the SSM regulation – frequently, they are the national central banks but they may also be the national financial supervisory authorities.

ACT

Regulation (EU) No 468/2014 of the European Central Bank of 16 April 2014 establishing the framework for cooperation within the Single Supervisory Mechanism between the European Central Bank and national competent authorities and with national designated authorities (SSM Framework Regulation) (ECB/2014/17) (OJ L 141, 14.5.2014, pp. 1–50)

last update 27.04.2020