A single supervisory mechanism for banking will restore trust, which is a prerequisite for EU member states to mutualise risk, European Central Bank President Mario Draghi told Economic and Monetary Affairs Committee MEPs on Monday.
MEPs generally welcomed the Council agreement on banking supervision, but voiced some concerns over possible loopholes and the ECB’s ability to assert its authority at national level.
Mr Draghi stressed the need to distinguish within the ECB between monetary policy,which aims to achieve price stability, and supervisory responsibilities. These will be shouldered by a supervisory board, providing independent analysis, using its own internal procedures and open to non-Euro area members.
“It is important to do it soon but more important to do it right”, said Mr Draghi, suggesting that the mechanism could take effect in March 2014.