European Central Bank Governing Council member Christian Noyer said the ECB must have oversight of all euro-area banks when it takes up its new role as a supervisor, Frankfurter Allgemeine Zeitung reported, citing an interview.
The ECB, which is due to take the role from January under a proposal by the European Commission, “must cover, in any case, all 6,000 banks within the euro area,” FAZ quoted Noyer as saying. “It’s better to forget about the entire project if it only includes the 20 biggest banks.”
Asked whether there might be a conflict of interest between monetary policy and banking supervision, Noyer, who heads the Bank of France, said that “14 out of 17 central banks in the euro area are also responsible for banking oversight,” FAZ reported. “Monetary policy is separated from banking supervision by Chinese walls.”
With regard to the ECB’s new bond-buying program, Noyer said it will be “up to elected governments and the IMF” to say whether or not countries under the program “fulfill conditionality,” according to FAZ. “We will not hesitate to stop the bond purchases right away if a country doesn’t adhere to the conditions under the ESM.”
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