On 4 November 2014 the Single Supervisory Mechanism (SSM) at the European Central Bank (ECB) was established and its operations started. As a preceding step the Council regulation No 1024/2013 of 15 October 2013 conferring specific tasks on the European Central Bank concerning policies relating to the prudential supervision of credit institutions (the ‘SSM Regulation’) was adopted. The SSM Regulation clarifies the ECB’s responsibilities and involvement in the supervision of significant and less significant supervised entities. According to Danièle Nouy, Chair of the Supervisory Board of the SSM, speech in November 2015 the ECB directly supervises 122 significant banking groups (possibly 130 in 2016). They represent for €25 trillion euro in assets which is more than 80% of the euro area banking sector by assets. For all the other banks in the Banking Union, the ECB is setting and monitoring the supervisory standards and cooperates with the national competent authorities (NCAs) in the supervision of these banks. All euro area countries participate automatically in the SSM, which means not all EU member states participate in the SSM. As of 1 December 2015, the number of SSM members is 19.
On 11 November 2015 the ECB launched a public consultation on the Draft ECB Regulation on the exercise of options and discretions available in Union law and the Draft ECB Guide on options and discretions. The consultation runs to 16 December 2015. In this way the ECB is exercising the options and discretions provided by the so-called prudential regulation (CRR/CRDIV) as the competent authority in the SSM participating Member States. The ECB Regulation shall apply exclusively to those credit institutions classified as significant. It concerns the areas of own funds, capital requirements, large exposures, liquidity and transitional provisions. The ECB Guide is a non-binding document which sets out the criteria which will be taken into account by the ECB in determining the prudential requirements for significant credit institutions. It concentrates preferably on the case-by-case options and discretions and aims to assist the Joint Supervisory Teams in the performance of their tasks.
The ECB declares that where relevant Union law is composed of regulations and where currently those regulations explicitly grant options and discretions for Member States, the ECB should also apply the national legislation exercising those options and discretions as far as those national rules do not affect the smooth functioning of the SSM, for which the ECB is responsible.
The options include the situations when EU Member States or competent authorities may choose from 2 or more alternatives provided for by EU law. The national discretions may be availed by Member States or competent authorities via national legislation. More than 160 options and discretions have been identified in the CRR/CRD IV package (including relevant delegated acts). The options and discretions may be classified according to several criteria:
The exercise of options and discretions in the Czech Republic may found here.