EN 
 
 
 
OPINION OF THE EUROPEAN CENTRAL BANK 
of 2 August 2006 
at the request of Poland’s Sejm Marshall on  
a draft law amending the Law on Narodowy Bank Polski 
(CON/2006/39) 
 
Introduction and legal basis  
On 14 June 2006, the European Central Bank (ECB) r eceived a request from Poland’s Sejm Marshall for 
an opinion on a draft law (hereinafter the ‘draft  law’) amending the Law on Narodowy Bank Polski of 
29 August 19971 (hereinafter the ‘Law on NBP’). 
The ECB’s competence to deliver an  opinion is based on Article 105(4) of the Treaty establishing the 
European Community and the third and sixth indents of Article 2(1) of Council Decision 98/415/EC of 
29 June 1998 on the consultation of the European Ce ntral Bank by national authorities regarding draft 
legislative provisions2, as the draft law relates to a national central bank, namely Narodowy Bank Polski 
(NBP), and to rules applicable to fi nancial institutions insofar as they materially influence the stability of 
financial institutions and markets. In accordance with the first sentence of Article 17.5 of the Rules of 
Procedure of the European Central Bank, the Governing Council has adopted this opinion.  
 1.  Purpose of the draft law The draft law proposes to amend the Law on NBP by modifying the composition of the Banking 
Supervision Commission, currently a seven-member bod y chaired by the President of NBP and supported 
by NBP staff
3. Following the draft law: 
(i)  the membership of the Commission would be expanded to include, in addition to the current 
members, three representatives of Sejm (one of the two Parliamentary chambers) and a representative of the Council of Ministers’ President (the Prime Minister); and 
(ii) the chair of that Commission would be re-allocat ed from NBP’s President to a representative of the 
Prime Minister
4.  
                                                 
1  Consolidated text: Dz. U. of 2005, No 1, Item 2, as amended. 
2  OJ L 189, 3.7.1998, p. 42. 
3  Current membership of the Banking Supervision Commission: (i ) the NBP’s President as Chair; and (ii) the Minister for 
Finance or the appointed Secretary/Unders ecretary of State in the Ministry of Finance (as deputy Chair); and (iii) the 
representative of Poland’s President; and (iv) the Bank Guar antee Fund’s Chair; and (v) the Securities and Exchange 
Commission Chair or Deputy; and (vi) the representative of th e Minister for Finance; and (vii) the General Inspector of 
Banking Supervision (Article 26(1) of the Law on NBP). 
4  Article 1 of the draft law, modifying Article 26(1) of the Law on NBP. 
2  
2. General observations 2.1 The draft law was proposed in parallel with another legislative proposal aiming at a broader 
modification of the institutional set-up for banking supervision in Poland, i.e. the draft law on the 
supervision of the financial market
5, on whose earlier version the ECB commented in ECB Opinion 
CON/2006/156. In its current version, the draft law on the supervision of the financial market 
foresees the taking over of the banking supervis ion responsibilities from 1 January 2008 by a 
consolidated financial supervisor under the name  of the Financial Supervision Commission (FSC)7. 
In the temporary period before 1 January 2008,  the Banking Supervision Commission would be 
chaired by the Financial Supervision Commission’s Chair, appointed by the Prime Minister8.  
2.2 The ECB understands that only one of the legisla tive proposals in question – i.e. either the draft 
law subject to current consultation or the draft law on the supervision of the financial market – 
would be subject to further legislative work. What ever the Polish legislator’s final decision, the 
ECB would like to reaffirm its very positive assess ment of the current institutional model for the 
prudential supervision of credit institutions in Po land, which ensures effective synergies between 
the Banking Supervision Commission and NBP. In concurrence with the recent comments by 
international bodies9, the ECB notes that any modification to the current arrangements will need to 
safeguard the effectiveness of the Polish superv isory system and smooth interaction between the 
relevant authorities. The on-going implementation of the recast Capital Requirements Directive10 is 
one area where there is a particular need to ensu re the continuity of supervisory activities and 
macro-prudential monitoring. 
2.3 In general, the ECB has consistently favoured  the involvement of central banks in prudential 
supervision. As already noted in the ECB Opinion CON/2006/15 and previous ECB opinions11, 
                                                 
5  The draft law on supervision of financial market, as adopted  by Sejm  on 21 July 2006 (Sejm ref. No 802) and provided 
to Senat for review. 
6  Opinion CON/2006/15 of 9 March 2006 at the request of the Po lish Minister of Finance on a draft law on the supervision 
of financial institutions. 
7  The FSC is to be composed of: (i) the FSC Chair, appointed  by the Prime Minister for a five-year term in office; and 
(ii) the two FSC Deputy Chairs, appointed and dismissed by the Prime Minister on a motion by the FSC Chair; and (iii) 
the Minister responsible for financial institutions or representa tive thereof; and (iv) the Minister responsible for social 
security or representative thereof; and (v) NBP’s President or the delegated Vice-President; and (vi) a representative of 
Poland’s President (Article 5(1) in conjunction with Article 3(1), Article 68 and Article 69(2) of the draft law on the 
supervision of the financial market). 
8  Article 80(2) of the draft law on the supervision of th e financial market. Additionally , as a result of winding-up the 
Securities and Exchange Commission its Chair will cease to be a member of the Banking Supervision Commission. 
9  See International Monetary Fund, ‘Concluding Statement of the 2006 Article IV Consultation Mission’, 22 May 2006, 
paragraph 13, as published on the IMF website (www.im f.org); Organisation for Economic Co-operation and 
Development, ‘Economic Survey of Poland, 2006’, 28 J une 2006, p. 4, as publishe d on the OECD website 
(www.oecd.org). 
10  Directive 2006/49/EC of the European Parliament and of  the Council of 14 June 2006 on the capital adequacy of 
investment firms and credit institutions (recast) (OJ L 177, 30.6.2006, p. 201). See paragraph 6.1 of Opinion 
CON/2006/15. 
11  Paragraph 2.1.2 of the Opinion CON/2006/15; cf. para graph 4 of ECB Opinion CON/2001/10 of 25 May 2001 at the 
request of the Austrian Ministry of Finance on a draft Fe deral law establishing and orga nising the financial market 
supervisory authority [title s hortened]; paragraph 5 of ECB Opinion CON/2001/35 of 8 November 2001 at the request of 
the German Ministry of Finance on a draft law establis hing an integrated financ ial services supervision. 
3 maintaining close involvement of NCBs in prud ential supervision is an important condition for 
allowing the Eurosystem to contribute adequately to  monitoring the risks to financial stability in the 
euro area, in accordance  with Article 105(5) of the Treaty, and to safeguard smooth cooperation 
between the central bank functions exercised at  the Eurosystem’s level and the supervisory 
functions carried out at national level.  
 3. The banking supervisor’s operational independence 3.1 In the composition of the Banking Supervision Commission proposed by the draft law, only a 
minority of the members would exercise their function ex officio , i.e. as a result of a nomination for 
a specified public office (those include: NBP’s President
12, the General Inspector of Banking 
Supervision13, the Chair of the Bank Guarantee Fund14, the Chair of the Securities and Exchange 
Commission15 and the Minister for Finance, if he chooses to participate directly in the 
Commission’s work). The remaining six members, in cluding the Chair, would be representatives of 
the appointing institutions, subject to recalling of their mandate at any time16. Moreover, the ECB 
notes that the draft law provides neither for such members’ appropriate technical expertise nor for adequate safeguards against conflicts of interest.  
3.2 The ECB recommends that any legislative provi sions setting out an institutional framework for 
prudential supervision foresee for the members of th e supervisory authority the appropriate criteria 
for technical expertise and for the avoidance of any conflict of interests, as well as adequate safeguards for decision-making autonomy in pursu ance of the supervisory mandate. The adopted 
legislative rules should ensure the supervisory au thority’s operational independence, in compliance 
with international standards for the opera tional independence of banking supervisors
17.  
 4. The central bank’s financial stability role 4.1 Under the current provisions of the Law on NBP, NBP’s President acts both as the Chair of the 
Banking Supervision Commission and supervisor of the General Inspectorate of Banking 
                                                 
12  NBP’s President is appointed and dism issed by Sejm, at the request of Poland’ s President, for a term of six years 
(Article 9(1) of the Law on NBP). 
13  NBP’s President appoints and dismisse s the General Inspector of Banking Superv ision, acting in agreement with the 
Minister for Finance (Article 29(3) of the Law on NBP). 
14  The Fund’s Council appoints and dismisses the Bank Guarantee Fund’s Chair for the three-year term in office (while the 
Prime Minister, the Minister for Financ e, NBP’s President and the Polish Bank Association are involved in appointing 
members to the Fund’s Council; Article 9(1) and (3) to (5), Article 6(1) to (3) of the Law on the Bank Guarantee Fund of 
14 December 1994, consolidated text: Dz.U. of 2000, No 9, Item 131, as amended). 
15  The Prime Minister appoints the Chair of the Securities and Exchange Commission, for a five-year term in office, acting 
on a motion he Minister responsible for financial institutions presented in agreement with NB P’s President (Article 8(2) 
of the Law of 29 July 2005 on supervision of the capital market, Dz. U. 2005 No 183, Item 1537). 
16  Such would be the status of the following members: a re presentative of the Prime Minister in their capacity as the 
Commission’s Chair, a representative of Poland’s President, three Sejm representatives and a representative(s) of the 
Minister for Finance. 
17  See Bank for International Settlements, Core Principles for Effective Banking S upervision, September 1997, Principle 1; 
see the Consultative Document on the Co re Principles for Effective Banking S upervision, April 2006, Principle 1; 
documents available on the BIS website (www.bis.org). 
4 Supervision, which is an organisational unit w ithin NBP’s structure, functioning as the Banking 
Supervision Commission’s executive arm18 and closely cooperating with other relevant NBP 
departments. As already noted in ECB Opinion C ON/2006/15, this current structure allows NBP to 
properly fulfill its financial stability role and, from a more specific Eurosystem perspective, is 
particularly well-designed to facilitate NBP’s cont ribution to the prudential supervision of credit 
institutions and the financial system’s stability, as required, also in the future euro accession 
context, under Article 105(5) of the Treaty19.  
4.2 It is noted in this context that NBP’s financia l stability role – as currently  exercised on the basis of 
the abovementioned institutional arrangements – l acks specific legislative definition in the Law on 
NBP20. Assuming the implementation of a supervisor y reform weakening the existing institutional 
relationship between NBP and the banking supervis ory authority, the ECB recommends amending 
the Law on NBP, so as to specify that NBP has a formal responsibility for contributing to financial 
stability by monitoring and assessing the financial system as a whole, as a separate function from hands-on supervision a nd financial regulation
21. 
 This opinion will be published on the ECB’s website. 
 
 
Done at Frankfurt am Main, 2 August 2006. 
 
[signed] 
 
The President of the ECB 
Jean-Claude TRICHET 
 
                                                 
18  Articles 29(1) and 25(1) of the Law on NBP. 
19  See paragraph 3.1.1 of Opinion CON/2006/15. 
20  The closest legislative provision which may currently imply NBP’s financial stability role is its statutory objective to 
‘establish the necessary conditions for the development of the banking system’ (Article 3(2)(6) of the Law on NBP). See 
paragraph 2.2.1 of Opinion CON/2006/15.  
21  See paragraph 2.2.2 of Opinion CON/2006/15.