One year on from the start of the Single Supervisory Mechanism (SSM), the European Central Bank (ECB) has made significant progress in developing and embedding its supervisory approach. But what still needs to be done to realise the vision that the ECB set out at the start of this journey?

1. 2012
S
etting the sce
ne
Roadmap to a
Banking Union
September 2012
Pillars of the
Banking Union
SSM, SRM, DGS
and Single Rulebook
SSM legislation proposed
September 2012
Objectives and deliverables for the
Banking Union set
Financial stability
EU level supervision
Breaking bank-sovereign nexus
Greater financial integration
Increasing efficiency of the banking system
SSMBankingUnion

2. SSMBankingUnion
2013
A cornerstone of the Single Rulebook delivered
July 2013
SSM: Organisation and structure
Directorates General (DGs)
Microprudential Supervision I and II
DG Microprudential Supervision III
DG Microprudential Supervision IV
The SSM’s first steps
October 2013
The SSM Regulation entered into force
November 2013
The Comprehensive Assessment started
November 2013
Leadership appointed:
Danièle Nouy, SSM Chair, assumed office
The Banking Union
project gears up
Th
e journey beg
ins

3. SSMBankingUnion
2014
Set
off & early days
The SSM will be “intrusive’,
”tough” and “fair”
Danièle Nouy , SSM Chair
SSM: a lot of luggage on board
Immediate challenges for
SSM leadership
Results of the
health check
Supervision of significant
banks under the SSM
Progress on other elements of the Banking Union
April 2014
The European Parliament adopted BRRD and DGSD
The SSM formally assumed office
4 November 2014

4. SSMBankingUnion
2015
Getting a grip
Direction of travel is set
Reducing national discretions
Validation of internal models
Viability of business models
Governance at institutional level
Internal stress testing practices
Operational risk
Credit risk management
Harmonisation of supervisory practices
More intrusive approach to supervision
New supervisory approach
of the ECB
1. Harmonising risk based,
forward looking supervision
2. More quantitative approach
3. Supervisory consistency as a
driver for change
4. Peer group analysis as a key tool
Business model analysis at
the centre of the SREP
Sustainability of bank’s
business models based on:
1. Business model viability
2. Sustainability of strategy
3. Identification of key
vulnerabilities
ECB priorities in 2015: key workstreams
SRM: first steps
The Single Resolution Board was established and began to
develop resolution plans and engage in resolvability assessments

5. Completing the SSM
Significant banks
Expansion of the SSM
Supervisory framework
Common supervisory culture
Smaller banks
Broader context
SSMBankingUnion
2016+ Business as usual while adapting to change
Challenge of establishing an EU-wide DGS
SRM in action and key unknowns
Official start of SRM
Recruitment of staff
€55bn budget
Decision-making
Resolvability & loss absorbency
Completing the Banking Union