Since the Single Supervisory Mechanism (SSM) opened for business
in November 2014, it has continued to grow, both in scope and
influence. However, much remains to be done for the European
Central Bank (ECB) and National Supervisory Authorities (NCA) to
develop and embed the new supervisory approach. Deloitte has
surveyed 45 directly supervised banks to assess their perception of
the SSM and its current impact.
Directly supervised banks
To be able to plan effectively, it is important for banks to
understand the impact the new supervisory regime has across the
region, and to benchmark their experiences and current practices
against peers. For this reason, Deloitte launched its Eurozone
banking supervision survey. The goals of the 2016 survey were to
monitor and analyze progress in terms of relationships,
organizational impact, and technical issues regarding the new
supervisory activities and regulations. In addition, it provides an
overview of the topics that banks consider to be key over the short
and long term.
Many banks still have projects
underway to tackle shortcomings identified following the financial
crisis, including through the ECB's 2014 comprehensive
assessment exercise. New supervisory initiatives need to compete
with those projects for time and resources.
Implementation of the European
Banking Authority's (EBA's) new guidelines on the
Supervisory Review and Evaluation Process (SREP) remains a key area
of concern and uncertainty.
The establishment of the SSM has not
only increased the supervisory spent at 47 percent of banks by more
than 50 percent, it also necessitated changes to the way banks
manage their supervisory relationships. The impact of the new
supervisory regime goes beyond the supervisory approach and the new
Banks ranked risk data aggregation,
data quality, implementation of IFRS 9 and supervisory assessments
of business models as the most challenging aspects of the SSM's
This article contains general information only, and none of
the Deloitte entities belonging to the Deloitte Network is, by
means of this article rendering accounting, business, financial,
investment or other professional advice or services. This article
is not a substitute for such professional advice or services, nor
should it be used as a basis for any decision or action that may
affect the reader's finances or business. Before making any
decision or taking any action that may affect the reader's
finances or business, the reader should consult a qualified
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