June 6, 2019 / 10:58 AM / 10 days ago

Austria puts banking supervision reforms on ice after government breakdown

VIENNA (Reuters) - Austria’s government put plans to reform its banking supervision on hold after the collapse of the right-wing coalition government in the wake of a video sting scandal, Austria’s Financial Market Authority (FMA) said on Thursday.

Ousted conservative Chancellor Sebastian Kurz’s government said last year it would shift the central bank’s supervision tasks to the FMA.

Supervision of banks operating in Austria and not directly overseen by the European Central Bank’s banking watchdog SSM has been shared by the FMA and the Austrian National Bank (ONB) for years.

Austrian magazine Profil first reported on the halt, saying that employees of the National Bank (OeNB) and FMA received an internal letter on the freeze at the end of May. An FMA spokesman confirmed the letter.

The parliament was supposed to discuss the plans in the summer but big legislative initiatives are now not expected in the coming months with the country being governed by a transitional government until new elections in September.

Reporting by Alexandra Schwarz-Goerlich, writing by Riham Alkousaa

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