2014-09-10
The Bank of Lithuania will have its representative at the single supervisory mechanism (SSM) — the main regulatory body of European banking activities, which will begin its work in the autumn of this year. The deputy chairman of the Board of the Bank of Lithuania, Ingrida Šimonytė, on Wednesday, 10 September, will participate for the first time in the SSM Supervisory Board’s meeting in Frankfurt.
“In joining the euro area, Lithuania will participate also in the single supervisory mechanism, which supervises the most important banks of the euro area, including the three largest banks in Lithuania. It will also have a voice in dealing with major issues on the regulation of banking activities,” says I. Šimonytė.
She will represent the Bank of Lithuania in the Supervisory Board, which will submit to the highest European Central Bank (ECB) management structure — the Governing Council — conclusions on capital, the execution of liquidity and other requirements, will present decisions on possible sanctions and other risk-mitigating enforcement measures.
The single supervisory mechanism is the most important element of the European banking union, which is being developed and which will aim to ensure the security and reliability of the European banking system, as well as increase financial integration and stability in Europe.
When Lithuania will join the SSM, the ECB will take over the supervision of the largest registered banks in Lithuania. The supervision of the other banks will remain with the Bank of Lithuania, in cooperation with the ECB.