FRANKFURT (MNI) – The European Central Bank should not become the
EU’s top bank supervisory authority, as this could undermine its
independence and create conflicting policy goals, Bundesbank board
member Andreas Dombret said Wednesday.
While the ECB does have a role to play in bank supervision,
“monetary policy should in any case be separated as much as possible
from supervision,” Dombret said in a speech for delivery at the 30-year
anniversary of the Association of Foreign Banks in Germany.
Giving the ECB primary responsibility for supervision would require
a level of democratic accountability that could weaken its independence,
since “supervisory rights imply wide-ranging intervention rights that
require direct democratic legitimacy,” he explained.
“If the central bank has final, sovereign responsibility, its
independence would have to be curbed,” Dombret said. “And please do not
overlook that monetary policy decisions can have influence over the
robustness of banks. This can very well lead to conflicting goals.”
“These are all good reasons, I believe, to give the final
responsibility not to the ECB, but to a different authority, led by a
council in which the banks’ home countries are adequately represented,”
he said.
The ECB could still be involved in various operational aspects of
supervision, he said. “Without question, the ECB would have an
especially important and extensive advisory role in this construct.”
Dombret reiterated his opposition to sharing national liabilities
at the Eurozone level before EMU authorities can exercise control over
the fiscal policy of member states: “As long as control remains with the
nation-state, liability must remain there as well.”
–Frankfurt bureau tel.: +49-69-720142. email: frankfurt@mni-news.com
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