ECB’s Elderson: Need to Become Better at Proposing Solutions to Banking Sector Problems

1 December 2023

By Isabel Teles – FRANKFURT (Econostream) – European Central Bank Executive Board member Frank Elderson on Friday said that supervisors and banks could not be content and needed to translate rapidly the identification of sector problems into efforts at devising and proposing a solution.

In a panel during a conference at the ECB, Elderson said, ‘in a world that is changing faster we cannot be complacent as supervisors and as banks, by the way. We need to become better at remedying findings.’

‘We need to have a culture of effectiveness, of impact of supervision that maybe doesn’t go like this’, he said, clapping slowly, ‘but maybe goes like this’, he said, clapping faster. ‘Things need to be remedied because the world is changing fast.’

The ECB Supervisory Board was using the many instruments available in its toolkit, he said.

‘Of course, and this is the lawyer speaking, in a proportional way we will always prefer to have a real conversation and to convince a bank of the right way to go if we feel there is a certain risk that needs to be remedied’, he said. ‘But if then things don’t change for the better, we will be scaling up and I think this is one of the clear learnings of the recent past.’