Regulation 2010/1096 - Council Regulation 1096/2010 conferring specific tasks upon the European Central Bank concerning the functioning of the European Systemic Risk Board - Main contents

EN

Official Journal of the European Union

L 331/162

The financial crisis has revealed important shortcomings in financial supervision, which has failed to anticipate adverse macro-prudential developments and prevent the accumulation of excessive risks in the financial sector, and has in particular highlighted the weaknesses of the existing macro-prudential oversight.

In November 2008, the Commission mandated a High Level Group chaired by Mr Jacques de Larosière (the de Larosière Group) to make recommendations on how to strengthen European supervisory arrangements with a view to better protecting the citizen and rebuilding trust in the financial system.

In its final report presented on 25 February 2009, the de Larosière Group recommended, among other things, the establishment of a body at the level of the Union charged with overseeing risk in the financial system as a whole.

In its Communication of 4 March 2009 entitled ‘Driving European Recovery’, the Commission welcomed and broadly supported the recommendations of the de Larosière Group. At its meeting of 19 and 20 March 2009, the European Council agreed on the need to improve the regulation and supervision of financial institutions within the Union and to use the de Larosière Group’s report as a basis for action.

In its Communication of 27 May 2009 entitled ‘European Financial Supervision’, the Commission set out a series of reforms to the current arrangements for safeguarding financial stability at the level of the Union, notably including the creation of a European Systemic Risk Board (ESRB) responsible for macro-prudential oversight. The Council, on 9 June 2009, and the European Council, at its meeting of 18 and 19 June 2009, supported the view of the Commission and welcomed the Commission’s intention to bring forward legislative proposals so that the new framework could be fully established.

Regulation (EU) No 1092/2010 of the European Parliament and of the Council (3) established macro-prudential oversight of the financial system at the level of the Union and a European Systemic Risk Board (ESRB).

Given its expertise on macro-prudential issues, the European Central Bank (ECB) can make a significant contribution to the effective macro-prudential oversight of the Union’s financial system.

The Secretariat of the ESRB (the Secretariat) should be ensured by the ECB and, to this effect, the ECB should provide sufficient human and financial resources. The staff of the Secretariat should therefore be subject to the Conditions of Employment for Staff of the ECB. In particular, according to the preamble of the Decision of the ECB of 9 June 1998 on the adoption of the Conditions of Employment for Staff of the European Central Bank as amended on 31 March 1999 (ECB/1998/4) (4), the staff of the ECB should be recruited on the broadest possible geographical basis from among nationals of the Member States.

On 9 June 2009, the Council concluded that the ECB should provide analytical, statistical, administrative and logistical support to the ESRB. As it is the task of the ESRB to cover all aspects and areas of financial stability, the ECB should involve national central...