Thursday 24 October 2013

Europe: Single supervisory mechanism - ECB preparations begin with assessment of banks

The European Central Bank has published details of the assessment it will undertake in respect of the those banks it will directly supervise when its new supervisory responsibilities begin under the single supervisory mechanism: see here (pdf). The assessment will include, amongst other things, the following three related elements: (1) a supervisory risk assessment (to review key risks including liquidity, leverage and funding), (2) a review of asset quality and (3) a stress test in respect of the resilience of banks' balance sheets.

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