EU lawmakers will probably have to amend the rules governing the ECB as it embarks on the complex task of regulating banks, said Bundesbank VP Sabine Lautenschläger.
Partially translated from the German
As Bloomberg reports, Lautenschläger said: "It will be necessary to base common supervision on a solid legal basis and to make the governance structures simpler. I don’t think we’ll get around a primary law change to improve the governance structure and separate monetary policy more clearly from banking supervision."
"EU primary law doesn’t allow for another body than the ECB council to take final decisions", she added. "I doubt whether this type of decision-making structure of the supervisory mechanism is optimal. I’ve been in banking supervision for 18 years and I can tell you decisions sometimes have to be taken very quickly."
She also said that while joint supervision "will help identify problems earlier", Banking Union alone won’t solve Europe’s debt crisis.
As Finanzen.net reported, Lautenschläger reiterated the Bundesbank's view that a Banking Union must consist of only two elements - consistent restructuring and resolution mechanism and the joint supervision - and thereby rejected the idea of a common European bank deposit insurance.
She also rejected the idea that banks should be resolved by a European authority. For a permanent solution, a consistent primary legal basis was needed, she said. The same view is held by Finance Minister Wolfgang Schäuble. Like Schäuble, Lautenschläger argued for a transitional solution that she envisages to be a network of national resolution authorities and European arbitration.
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