Muller supports Europe-wide supervision

TALLINN - Estonia’s central bank Eesti Pank is convinced of the need for creation of pan-European banking supervision that was agreed upon at the European Union council meeting, reports Public Broadcasting. Eesti Pank’s Deputy President Madis Muller said that it is important that eventually a wholesome banking alliance would emerge, where other aspects would be important too, besides supervision. Eesti Pank does not see Sweden possibly staying out of the alliance as a major problem.

Muller said that the EU is moving in the right direction and changes help strengthen the EU and euro area economy and banking sector. He said, though, that it wouldn’t be good if eventually the banking alliance would be an incomplete one, it is important that the common deposits guarantee and crisis management mechanism also started working.
“This means additional risks for states. This means that responsibility and decision authority would not be in harmony in organizing the banking sector and eventually that would be bad, but on the other hand, when thinking about the first practical steps of today, the best thing would be to launch common banking sector supervision,” said Muller.

Initially banking supervision will cover 17 euro area states. This means that the homeland of the largest banks operating in Estonia, Sweden, would be left out. Madis Muller said that organizing practical work regarding supervision then requires a longer discussion in Estonia, but he sees no reason why a solution could not be found.