ECB finalises legal framework for banking supervision
FRANKFURT, April 25
FRANKFURT, April 25 (Reuters) - The European Central Bank has finalised rules for how it will supervise commercial banks in the 18-nation euro zone from November, it said on Friday.
The Single Supervisory Mechanism (SSM) framework regulation gives the central bank wide-ranging powers, including the right to demand that lenders increase their capital buffers, and spells out how the SSM will cooperate with national supervisors.
"The SSM Framework Regulation lays the basis for the work of the SSM when it takes over as supervisor of euro area banks in November 2014," the ECB said in a statement.
The document also forms the basis for defining which euro zone banks will qualify for direct supervision by the ECB. Those that do not match the criteria as outlined in the document will continue to be supervised by their national authority.
The list will be published in September.
(Reporting by Eva Taylor Editing by Jeremy Gaunt)