Opinion of the European Central Bank of 30 April 2013 on macro-prudential policy (CON/2013/30)
Date: 2013-04-30
Institutions: European Central Bank
Subjects: Malta, banking supervision, central bank, financial stability, national law

EN 

ECB-PUBLIC 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 30 April 2013 

on macro-prudential policy 

(CON/2013/30) 

Introduction and legal basis 

On  26  March  2013,  the  European  Central  Bank  (ECB)  received  a  request  from  the  Governor  of  the 

Central  Bank  of  Malta  (CBM)  for  an  opinion  on  the  draft  Central  Bank  of  Malta  Directive  No  11  on 

macro-prudential policy (hereinafter the ‘draft directive’). 

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 the third indent of Article 2(1) of Council Decision 98/415/EC of 

29  June  1998  on  the  consultation  of  the  ECB  by  national  authorities  regarding  draft  legislative 
provisions1, as the draft directive relates to the CBM. In accordance with the first sentence of Article 17.5 

of the Rules of Procedure of the ECB, the Governing Council has adopted this opinion. 

1.  

Purpose of the draft CBM Directive 

1.1  The  Central  Bank  of  Malta  Act2,  by  virtue  of  article  5(1)  and  (3),  empowers  the  CBM  to  issue 

directives as may be required to implement the provisions of the Central Bank of Malta Act. The 

draft directive implements Recommendation ESRB/2011/3 of the European Systemic Risk Board 
of 22 December 2011 on the macro-prudential mandate of national authorities3. More specifically, 

the draft directive implements Recommendation A1 on the ultimate objective of macro-prudential 

policy and Recommendation C4 on macro-prudential instruments. 

1.2  The draft directive will constitute a legally binding instrument. It is expected to be published by the 

end of June 2013 and to enter into force shortly thereafter. 

2. 

Specific observations 

2.1  The ECB supports the effective design of macro-prudential policy frameworks within the Member 

States, in line with the guiding principles expressed in Recommendation ESRB/2011/3. Moreover, 

the  ECB  considers  that the  ECB  and  national  central banks  should  play  a leading  role  in  macro-

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2  
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OJ L 189, 3.7.1998, p. 42.  
Chapter 204 of the Laws of Malta. 
OJ C 41, 14.2.2012, p. 1. 

 
 
 
 
 
                                                 
ECB-PUBLIC 

prudential  oversight,  given  their  expertise  and  existing  responsibilities  in  the  area  of  financial 
stability4. 

2.2 

In the light of the above, the ECB welcomes the arrangement under which the CBM is the national 

authority responsible for the conduct of macro-prudential policies, acting in cooperation with other 

authorities  whose  actions  have  a  material  impact  on  financial  stability,  in  particular,  the  Malta 

Financial Services Authority (MFSA). The ECB understands that the relevant arrangements in this 
respect are implemented through a Memorandum of Understanding5.  

2.3   At the same time, the ECB notes that performance by the CBM of macro-prudential tasks should 

not  affect:  (a)  the  CBM’s  institutional,  functional  and  financial  independence;  or  (b)  the 

performance by the European System of Central Banks of its tasks under the Treaty and the Statute 
of the European System of Central Banks and of the European Central Bank6. Moreover, the CBM 

in its capacity as a macro-prudential authority should be expressly mandated to cooperate with the 

European Systemic Risk Board (ESRB) and, where needed, with the macro-prudential authorities 
of  the  other  Member  States,  in  particular  with regard  to  the  exchange  of  information7.  The  ECB 

understands  that  an  express  stipulation  to  this  effect  is  included  in  the  Memorandum  of 
Understanding8. 

2.4  The ECB welcomes that paragraph 6(a) to (c) of the draft directive, grouping the macro-prudential 

instruments by reference to their intermediate objectives, is aligned with the direction of on-going 

analytical work by the ESRB. 

2.5  This  opinion  does  not  prejudice  the  conclusions  of  the  follow-up  assessment  of  the  above 

mentioned  recommendations  which  the  ESRB  will  issue  in  accordance  with  Article  17  of 

Regulation  (EU)  No  1092/2010  of 

the  European  Parliament  and  of 

the  Council  of 

24 November 2010  on  European  Union  macro-prudential  oversight  of  the  financial  system  and 
establishing a European Systemic Risk Board9. 

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

Done at Frankfurt am Main, 30 April 2013. 

[signed] 

The Vice-President of the ECB 

Vítor CONSTÂNCIO 

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9  

See  paragraph  5.1  of  Opinion  CON/2012/44  and  paragraph  3.1  of  Opinion  CON/2012/55.  All  ECB  opinions  are 
published on the ECB’s website at www.ecb.europa.eu. 
Memorandum of Understanding of 25 January 2013 between the Central Bank of Malta and the Malta Financial Services 
Authority on the setting up of a Joint Financial Stability Board (hereinafter the ‘Memorandum of Understanding’). 
See paragraph 4 of Opinion CON/2009/88 and paragraph 3.2 of Opinion CON/2012/55. 
See paragraph 5.3 of Opinion CON/2012/44 and paragraph 4.1 of Opinion CON/2012/55. 
See paragraphs 9 and 10 of the Memorandum of Understanding. 
OJ L 331, 15.12.2010, p. 1. 

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