ECB’s Elderson: Banks Need to Remediate Their Problems Faster

7 December 2023

By Isabel Teles – FRANKFURT (Econostream) – European Central Bank Executive Board member Frank Elderson on Thursday said that banks must not take long to address problems once these come to light.

In a speech at the House of the Euro, in Brussels, the text of which was posted to the website of the ECB, Elderson said that what happened to some banks earlier this year made it clear that once issues were detected, they must be resolved in a timely manner. ‘Our key lesson from the March 2023 turmoil is that we need banks to accelerate the pace of remediation’, he said.

By closely monitoring banks, supervisors detected risks to financial stability and acted ‘to ensure that banks take timely and commensurate corrective action on issues of prudential concern’, he said.

‘This approach is vital in preventing identified risks from crystallising into threats to bank solvency or financial stability’, he said.

It became evident from what happened in March 2023 that ‘intrusive and effective supervision is needed more than ever’, he said.