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Keep existing funding structure, improve efficiency of deliverables for EU supervisory authorities

Keep existing funding structure, improve efficiency of deliverables for EU supervisory authorities

​​ESBG responds to EU Commission consultation on ESAs operations





>> See the response








BRUSSELS, 18 May 2017 – The European Commission should keep in place the financing structure of the European Supervisory Authorities, argues savings and retail banking association ESBG in its 16 May response to the European Commission's consultation on the authorities' future. The main focus should be put on the efficiency of the level 2 instruments delivered by the ESAs, which should all be consulted, respectful of the mandate given at level 1 and issued timely in order to allow for implementation in a realistic timeframe.

 ESAs: A public good should receive continued EU funding

In its response, which touched on a dozen areas, ESBG opposes strongly any attempts to change the funding structure because ESAs form a necessary public good involved in oversight by public authorities. EU budget funds should continue to buttress the agencies that fall under the responsibility of EU institutions. They add that the banking industry already contributes heavily to regulation and supervision and additional EU contributions would further raise what it sees as an already disproportionate impact on savings and retail banks.

The response also touched on technical standards work, noting that ESAs are performing tasks that should be performed by the Commission pursuant to Articles 290 and 291 of the Treaty on the Functioning of the European Union, hence the need for a hefty part of ESAs costs covered by the Commission or EU budget.

EU institutions focus on level 1 text details, ESAs on level 2 texts such as technical standards, Q&As

ESBG sees vital that ESAs consult on all texts which are issued – whether they are technical standards, guidelines, recommendations or Q&As. Some texts may not be binding at EU level, but could be taken up by NCAs or become de facto binding due to the 'comply or explain' procedure.

EU institutions should also spend more time on figuring out the details in level 1 texts rather than leaving it all to the ESAs – which would allow the ESAs to better allocate their time and resources at level 2. Relatedly, ESBG calls on the European Commission to ensure that the ESAs do not overstep their mandate, in particular their work on non-core activities and own-initiative work, which would help them to follow the principle of prioritisation.

ESBG finally calls on the ESAs to reduce the time taken to respond to Q&As, which would reduce uncertainty and give more time for banks to implement the requirements before deadline.

Streamlined reporting requirements, one EU database to compile banks' data

On reporting requirements, ESBG members call for more cooperation between the ESAs, national competent authorities (NCAs) and the Single Resolution Board in order to streamline the requirements and thus reduce the constraints on market participants. ESBG argues that if the ESAs were to use data collected by NCAs via a comprehensive network of data hubs, then there would be no need to approach institutions for additional data sets and institutions would need to report data only once. It provides three ways to improve reporting requirements in its response.

Background

The European Commission launched on 21 March the public consultation on the way forward for the three European Supervisory Authorities – EBA, ESMA and EIOPA. The consultation has aimed to identify areas where the effectiveness and efficiency of the ESAs can be strengthened and improved, by further developing and integrating capital markets in Europe.

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>> See the response



European Supervisory Authorities (EBA-ESMA); European Institutions; Proportionality