ECB to Oversee Most French Banks, Bruegel Study Says

The European Central Bank will monitor most French banks under thresholds agreed upon early today, according to a study from the Brussels-based Bruegel Research Group.

European Union finance ministers agreed to give the ECB direct oversight of banks whose balance sheets have more than 30 billion euros ($39 billion) in total assets or represent more than 20 percent of their home country’s economy.

Bruegel researchers Guntram Wolff and Carlos de Sousa said 91 percent of euro-area banking assets and at least 180 firms would be captured under the terms of the agreement. For most countries in the 17-nation currency bloc, more than 80 percent of banking assets would be covered, Bruegel said.

“Notable exceptions are Portugal, Malta, Greece, Estonia, Slovenia and Slovakia,” the Bruegel study said. “In Slovakia, no bank would be under the direct oversight of the ECB, according to our database, while in France almost 100 percent of assets are covered.”

Today’s deal says the ECB generally will take on the top three banks in each participating nation. EU Financial Services Commissioner Michel Barnier said he expected the ECB would have day-to-day oversight of about 200 banks once it starts operations in 2014.

(Corrects spelling of Sousa in third paragraph.)
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