Brussels, 05/10/2012 (Agence Europe) - The new eurozone bank supervisory mechanism must be something that can be built upon, says Philippe Lamberts (Greens/EFA, Belgium), member of the European Parliament's Economic and Monetary Affairs Committee. At a conference organised by European Policy Centre, a thinktank, on Thursday 5 October, Lamberts explained some of the shortcomings of the system selected by the European Commission for its draft legislation, particularly the idea of getting non-euro countries on board, because countries would not want to join the mechansim if they have no say. Martin Merlin, head of the Financial Services Policy Unit at the European Commission, stressed the “open” nature of the mechanism which will start by supervising banks in all seventeen eurozone nations before expanding its work to cover the twenty-five countries that have not opted out of the euro. The Commission has suggested giving greater powers to the European Banking Authority so that it can act as a bridge for non-euro nations.
On Friday 6 October, Bloomberg reported that Germany will push for non-euro countries to have a greater voice, which would help encourage them to join the mechanism.
A second criticism expressed by Lamberts is the decision to give bank supervisory powers to the European Central Bank, which was laid down by Germany as a precondition for allowing the direct recapitalisation of eurozone banks. Lamberts says it will be difficult, if not impossible, to separate off monetary policy and bank supervision at the ECB because this would be like telling it to become schizophrenic. He also dislikes the idea of focusing too much power in the same place because the ECB, he said, is already the most powerful central bank on the planet. Merlin defended the choice, saying that the system would benefit from the ECB's huge reputation and credibility, pointing out that the priority was restoring trust among the Member States. (EL/transl.fl)