Speech at the Inauguration of the European Central Bank's new supervisory responsibilities
The crisis has caused many of our fellow citizens to question whether the European project can keep its promise of shared economic prosperity. And the response to the crisis indeed took time to take shape, as ECB did not initially have all the instruments to address its causes and consequences. This has forced ECB to fundamentally reflect on what is necessary to achieve a genuine economic and monetary union.
In particular, ECB needed to decisively and credibly address the weaknesses in the banking sector. This was not only key to restoring investors' confidence. It was also key to protecting citizens and businesses as taxpayers, depositors and borrowers.
ECB agreed that this challenge would be best addressed together through the establishment of a banking union. It entailed a Single Supervisory Mechanism, a Single Resolution Mechanism and a common rulebook, including for harmonised deposit guarantee schemes, which may evolve into a common European deposit guarantee.
This was a fundamentally political decision, taken by the European legislators - the Council and the European Parliament. And once the decision to establish the SSM had been made, the ECB assumed a key role in bringing about this change in only one year.
According to Draghi, the setting-up of European banking supervision has been the largest step towards deeper integration since the creation of our Economic and Monetary Union.
The President restated that the ECB was and remains determined to protect the euro, while reminding that more works needs to be done to improve "our" union, not only in the banking sector but also in relation to capital markets and in the economic and fiscal realms. "Our responsibility towards the people of this continent is indeed to put in place a sustainable economic model that helps to increase employment and boost growth", he said.
He concludes: “While we celebrate today an important achievement, we need to be humble for the future and to ensure that we deliver on our tasks, old and new. The ECB has at the core of its mandate the protection of price stability. We now need to protect the economy in one additional way, by preventing excessive risks in the banking sector.“
Full speech
© BIS - Bank for International Settlements
Key
Hover over the blue highlighted
text to view the acronym meaning
Hover
over these icons for more information
Comments:
No Comments for this Article