Opinion of the European Central Bank of 14 April 2011 on amendments to the Statute of the Bank of Greece (CON/2011/36)
Date: 2011-04-14
Institutions: European Central Bank
Subjects: Greece, central bank, financial stability, financial supervision, institutional activity, insurance company, national law, shareholder

EN 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 14 April 2011 

on amendments to the Statute of the Bank of Greece 

(CON/2011/36) 

Introduction and legal basis 

On 16 March 2011 the European Central Bank (ECB) received a request from the Bank of Greece (BoG) 

for  an  opinion  on  draft  legislative  provisions  introducing  amendments  to  the  Statute  of  the  Bank  of 

Greece (hereinafter the ‘draft provisions’). 

The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on the 

Functioning of the European Union and on 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  Central  Bank  by  national  authorities 
regarding draft legislative provisions1, as the draft provisions relate to the BoG and to rules applicable to 

financial 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 provisions 

The draft provisions serve the following main objectives. 

1.1 

In accordance with Law 3867/2010 on private insurance supervision, the establishment of a private 
life  insurance  fund  and  other  provisions2,  the  BoG  was  entrusted  with  the  task  of  supervising 

private insurance companies. As a result, the Statue of the BoG is amended to add to the main tasks 

of  the  BoG  the  supervision  of  insurance  companies.  In  addition,  under  the  draft  provisions,  the 

categories  of  entities  over  which  the  BoG  exercises  prudential  supervision  are  extended  to 

expressly include insurance companies and payment institutions. The BoG is required to submit an 

annual report to the Greek Parliament on the fulfilment of its supervisory tasks.  

1.2  The draft provisions amend certain conditions relating to shareholder rights.  Τhe record date, i.e. 

the date establishing a shareholder’s right to participate in the General Meeting and to vote on the 

basis of the number of shares they hold, is set at the beginning of the fifth day before the general 

1      OJ L 189, 3.7.1998, p. 42. 
2    
FEK 128 Α/3.8.2010. 

 
 
 
 
                                                 
meeting. The deadline for submitting the documents for the appointment of a proxy is reduced to 

three days prior to the general meeting. Furthermore, shareholder rights may not only be exercised 

by  Greek  citizens,  but  also  by  citizens  of  other  Member  States  and  European  Economic  Area 

countries.  

1.3  The  draft  provisions  extend  the  BoG’s  collective  bodies  to  include  the  Social  Security  Board 

(hereinafter  the  ‘Board’).  The  Board  was  originally  established  pursuant  to  Article  64  of  Law 
3863/20103  in  the  context  of  the  reassignment  to  the  BoG  of  the  task  to  provide  pensions  to  its 
staff4. The Board’s appointment, composition and tasks under the draft provisions reflect, to some 

extent, Article 64(2) and (3) of Law 3863/201. Pursuant to the draft provisions, the Board will be 

composed  of  the  BoG’s Governor,  an  employee  of  the  General  Secretariat  of  Social  Security,  an 

employee of the Ministry of Finance, a high-ranking BoG official, two representatives of the BoG’s 

insured staff members and a representative of the BoG’s pensioners. Furthermore, a Government 

Commissioner  will  participate  in  the  Board’s  meetings,  but  will  not  have  the  right  to  vote.  The 

Board will be responsible for defining the BoG’s general policy guidelines concerning its provision 

of pensions to its staff. The Board will also decide on general issues relating to the application of 

relevant legislation by the BoG’s competent bodies and officials. Moreover, the Board will decide 

on appeals against negative decisions of the BoG relating to pensions, and approve the exercise of 

all relevant legal remedies and actions available to the BoG before all courts of law. 

1.4  Where  a  legal  entity  supervised  by  the  BoG  enters  into  liquidation  following  withdrawal  of  its 

authorisation,  the  draft  provisions  allow  the  BoG  to  pay  the  liquidator’s  remuneration  and  the 

liquidation costs. In turn, the BoG will acquire a claim against the legal entity in liquidation for the 

reimbursement of any amounts paid to the liquidator with priority over any other claim in respect 

of the proceeds of liquidation. 

2. 

General observations 

The  ECB  understands  that  the  general  aim  of  the  draft  provisions  is  to  amend  the  Statute  of  the 

BoG to: (a) take into account recent national legislative developments that affect the BoG’s tasks; 

(b) adequately reflect the BoG’s role in ensuring the efficient conduct of the liquidation process of 

the entities it supervises; (c) ensure compliance with Union law in force. In this respect, the ECB 

generally  welcomes  the  draft  provisions  as  a  means  to  address  important  aspects  related  to  the 

operation of the BoG and the performance of its tasks. The proposed amendments to the Statute of 

the  BoG  would  also  enhance  the  consistency  of  the  relevant  legal  framework,  thereby  ensuring 

legal certainty. 

3  
4  

Law on the new social security system and related provisions, FEK 115A/15.7.2010.  
According  to  the  first  sentence  of  Article  64(1)  of  Law  3863/2010,  as  of  1  January  2011  the  BoG  will  undertake  and 
arrange  social  insurance  for  its  staff  in  the  main  and  supplementary  pension  sectors;  Article  64  of  Law  3863/2010  re-
established the pensions regime which was applicable to the BoG staff prior to the adoption of Law 3655/2008 (FEK 58 
Α/3.4.2008). 

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3. 

Specific observations 

3.1 

Supervisory role 

3.1.1  The ECB notes that the draft provisions on the extension of the BoG’s supervisory tasks are limited 

to the insertion in the BoG’s Statute of a reference to the new categories of entities subject to the 

BoG’s supervision.  

3.1.2  As the transfer of insurance sector supervisory competences to the BoG was addressed in Opinion 
CON/2010/335, the ECB would like to reiterate that the BoG’s new functions should be performed 

in  line  with  the  relevant  specific  observations  expressed  in  that  Opinion.  In  particular,  the  ECB 

notes  that  the  expanded  supervisory  tasks  of  the  BoG  will  require  increased  resources,  as  also 
acknowledged in the updated Economic Adjustment Programme for Greece6. 

3.1.3  As  regards  the  supervision  of  financial  institutions  other  than  credit  institutions  by  the  BoG,  the 

ECB  welcomes  the  reference  to  payment  institutions.  Moreover,  the  ECB  notes  that  Directive 

2009/110/EC of the European Parliament and of the Council of 16 September 2009 on the taking 

up,  pursuit  and  prudential  supervision  of  the  business  of  electronic  money  institutions  amending 
Directives  2005/60/EC  and  2006/48/EC  and  repealing  Directive  2000/46/EC7,  which  is  to  be 

implemented by the Member States by 30 April 2011, amends the definition of credit institutions as 

provided for in Article 4 of Directive 2006/48/EC of the European Parliament and of the Council of 
14 June 2006 relating to the taking up and pursuit of the business of credit institutions (recast)8. As 

a  result,  electronic  money  institutions  will  appear  as  a  separate  category  of  financial  institutions. 

Thus,  the  legal  framework  relating  to  the  supervision  of  such  institutions  by  the  national  central 

banks will have to be readjusted accordingly. 

3.2 

Shareholder rights 

The proposed amendments relating to shareholder rights are in line with Directive 2007/36/EC of 

the  European  Parliament  and  of  the  Council  of  11  July  2007  on  the  exercise  of  certain  rights  of 
shareholders in listed companies9. Nevertheless, the exact point in time before the general meeting 

by which shareholders should register in the BoG’s books in order to be able to exercise their rights 

should be clarified, as the formulation proposed for the amendment to Article 13 of the Statute of 

the BoG, referring to ‘the beginning of the fifth day’ prior to the general meeting, is not sufficiently 

clear. 

5  
6  

7  
8  
9  

See paragraph 3 of CON/2010/33. All ECB opinions are published on the ECB’s website at www.ecb.europa.eu. 
Third Review - winter 2011. See in particular the updated Memorandum of Understanding on Specific Economic Policy 
Conditionality  and  the  Memorandum  of  Economic  and  Financial  Policies,  available  on  the  European  Commission’s 
website at: http://ec.europa.eu.  
OJ L 267, 10.10.2009, p. 7. 
OJ L 177, 30.6.2006, p. 1. 
OJ L 184, 14.7.2007, p. 17. 

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3.3  Central bank independence 

3.3.1  As  regards  proposed  Article  37A,  the  envisaged  appointment  of  the  Board  by  a  decision  of  a 

government authority and its composition, combined with its tasks, raise concerns with regard to 

central bank independence. 

3.3.2  In  particular,  proposed  Article  37A  provides  for  the  appointment  of  the  Board  by  means  of  a 

decision  of  the  Ministry  of  Labour  and  Social  Security  for  a  term  of  office  of  three  years. 

Moreover,  regarding  the  Board’s  composition,  two  of  its  members  will  be  appointed  by  the 

Minister of Finance and the Minister of Labour and Social Security, respectively. Furthermore, a 

Government Commissioner will be invited, under penalty of nullity of the meeting, to participate in 
all the meetings of the Board, but will not have the right to vote10. The draft provisions on both the 

appointing authority and the composition of the Board imply that the Board will perform its tasks 

without any involvement whatsoever of the BoG’s General Council, which according to the Statute 

of the BoG is, in that respect, the competent collective decision-making body. 

3.3.3  As regards its tasks, the ECB understands that according to the draft provisions, the Board does not 

have an advisory role with respect to the BoG, but is empowered, inter alia, to make decisions on 

the BoG’s policy on issues relating to the provision of pensions to its staff and on all legal remedies 

and actions available to the BoG in pension matters. In addition, according to Article 64(1) of Law 

3863/2010,  the  Board  may  amend  statutory  provisions  of  the  BoG  relating  to  the  provision  of 

pensions to its staff by a decision approved by the BoG’s General Council.  

3.3.4  Taking  into  account  the  above,  the  tasks  entrusted  to  the  Board  under  proposed  Article  37A, 

combined  with  its  appointment  and  composition  as  envisaged  therein,  raise  a  compatibility  issue 

with  Article  38  of  the  Statute  of  the  BoG  according  to  which  the  BoG’s  staff  will  receive  their 

pensions  based  on  terms  laid  down  by  the  BoG’s  General  Council  (without  prejudice  to  the 

applicable  general  legislation).  Furthermore,  the  scheme  introduced  by  the  draft  provisions could 

result in the Government influencing the autonomous formulation of the BoG’s policies on pension 

matters and ultimately on the BoG’s finances. The BoG’s autonomy in relation to staff pensions, 
which  is  an  aspect  of  the  financial  independence  of  a  central  bank11,  would,  therefore,  be 

potentially compromised.  

3.3.5  These concerns should be adequately taken into account in the proposed appointment, composition 

and  delimitation  of  the  tasks  of  the  Board,  which  to  some  extent  attempt  to  accommodate  the 

provisions  of  Article  64  of  Law  3863/2010.  To  this  end,  the  Board  could  be  appointed  by  a 

decision  of  the  BoG’s  General  Council  and  the  participation  of  members  appointed  by  the 

government  could  be  limited  to  the  Government  Commissioner  as  provided  for  in  proposed 

Article 37A.  Alternatively,  the  Board  could  have  only  advisory  functions  to  the  BoG’s  General 

Council  on  relevant  matters.  Such  solutions  would  also  ensure  the  operation  of  the  Board  as  a 

10  
11  

The Government Commissioner will have the right to veto decisions of the Board purely on grounds of legality. 
See Convergence Report 2010, p. 23. 

4 

                                                 
specialised  and  flexible  body  and  would  be  in  line  with  the  structure  of  the  BoG  and  the 

requirements of its Statute, and in particular its independence. Finally, the ECB considers that the 

term of office of the Board members could be further specified in the draft provisions. 

3.4  Financial aspect of the liquidation process and the monetary financing prohibition 

It  is  important  to  safeguard  compliance  with  the  prohibition  of  monetary  financing  pursuant  to 

Article  123  of  the  Treaty  supplemented  by  the  Council  Regulation  (EC)  No  3603/93  of 

13 December  1993  specifying  definitions  for  the  application  of  the  prohibitions  referred  to  in 
Articles 104 and 104b(1) of the Treaty12. This is designed to prevent central bank financing of the 

public sector. The proposed eighth amendment to the BoG Statute aims to ensure the payment of 

the liquidator (remuneration and liquidation costs) in case of liquidation of an entity supervised by 

the BoG after the BoG withdraws its authorisation. The ECB understands that the BoG would have 

the right to recover any payment it made to the liquidator, on the basis of a priority claim against 

the entity in liquidation. In the specific case of the BoG and in its competence as the supervisor of 

these entities, the whole liquidation process is already controlled by the BoG, i.e. opening of the 

liquidation  process,  appointment  of  the  liquidator,  control  of  the  liquidator’s  activities. 

Accordingly, the  BoG  would  not  be  financing  a  public  sector  obligation  and  therefore,  the  draft 

provisions do not breach the monetary financing prohibition. 

This opinion will be published on the ECB’s website.  

Done at Frankfurt am Main, 14 April 2011. 

[signed] 

The President of the ECB 

Jean-Claude TRICHET 

12  

OJ L 332, 31.12.1993, p. 1. 

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