“We are considering different models for single supervision, including a more centralised approach where ESMA [the European Securities and Markets Authority] would be responsible for all or key supervisory decisions, whilst efficiently cooperating with national authorities”, said Maria Albuquerque, European Commissioner for Financial Services, on Thursday 12 June at a conference on the Savings and Investment Union (SIU) co-organised by the European Commission and the ECB.
“Supervision rooted solely in national practices risks creating new barriers undermining the very cohesion we are working to achieve. A more coordinated, effective approach to supervision is essential to support a truly integrated and resilient European financial system”, she stressed.
In particular, Ms Albuquerque pointed out that the “passport” principle, which allows a financial service provider authorised in one EU Member State to operate throughout the Union, too often remains a mere theoretical possibility due to differences in practice between national supervisory authorities.
The Commission is therefore exploring two avenues.
On the one hand, strengthening the convergence tools of the European supervisory authorities, in particular the ‘procedure for breach of EU law’ or ESMA’s ‘Binding mediation’.
In addition, a targeted transfer of certain supervisory tasks to the European level is under consideration. This includes critical infrastructures such as clearing houses, central securities depositories and trading platforms, as well as financial firms such as asset managers.
EFSIR. On Thursday, the European Commission published its annual review of the European Financial Stability and Integration Review (EFSIR). According to this analysis, which covered the year 2024 and up to the end of April 2025, financial stability in the EU remained generally contained, despite occasional episodes of market volatility.
The main risks identified concern a possible sharp revaluation of financial assets, the sustainability of public and private debt, and persistent vulnerabilities in the non-banking sector.
“Non-bank financial intermediaries (mainly investment funds, insurers and pension funds) are facing increased risks of disorderly market corrections and deteriorating credit quality. For operators with high leverage and liquidity mismatches, adverse market developments could lead to forced assets sales, potentially speeding up price corrections”, notes the Commission.
On the other hand, according to this annual assessment, financial integration within the euro area “stabilised” in 2024.
“Trends in price-based financial integration were mainly positive throughout 2024, partly due to decreasing inflationary pressure along with normalising monetary and financing conditions. (...) These shifts underscore the significant influence of geopolitical events on financial integration dynamics in the euro area”, notes the Commission.
The EU institution’s experts also identify the challenges and opportunities arising from the growing use of artificial intelligence in financial services. They conclude that this technology offers significant efficiency gains, but also presents systemic, ethical and cybersecurity risks that require greater vigilance on the part of regulators.
To see the ‘EFSIR 2025’ report: https://aeur.eu/f/hak (Original version in French by Bernard Denuit)