On 4 November 2014, the European Central Bank became the prudential regulator for all Eurozone banks under the Single Supervisory Mechanism. The SSM does not introduce another layer of substantive regulation but significantly changes the way in which prudential supervision is applied in practice within the Eurozone. The intent is to provide for more consistent and harmonized supervisory practices and standards within the Eurozone, which is an inherently difficult goal to achieve given local country complexities and the continuing need to rely on on-the-ground national regulators. The ECB will nonetheless have a powerful role in the supervisory landscape and will doubtless try to shape and steer supervisory culture going forward.
View full memo, Banking Supervision Within the Eurozone: The Single Supervisory Mechanism