It has also been entrusted with other basic functions, such as conducting foreign-exchange operations consistent with the exchange rate policy established, holding and managing the official foreign-exchange reserves of the Member States, and promoting the smooth operation of payment systems. Since 2014, under Article 127(6) of the TFEU and Council Regulation (EU) No 1024/2013 (the “SSM regulation”), the ECB is responsible for specific tasks relating to the prudential supervision of banks located in the participating Member States. The ECB performs these functions within the framework of a Single Supervisory Mechanism made up of the ECB and the national competent authorities, as explained in Part 2 of this Annex. Finally, the ECB has the exclusive right to authorise the issue of banknotes in the euro area, to compile and produce statistics in collaboration with the NCBs in the performance of their functions, and to issue reports on consultations on legislative initiatives of the EU or of the national authorities concerning its sphere of competence. The organisation of the Eurosystem is based on the principle of decentralisation. Decision-making is centralised, while the implementation of decisions is decentralised. In practice, the NCBs perform almost all operational tasks of the Eurosystem: they conduct the monetary policy operations and, as agents of the ECB, manage its foreign reserve holdings, provide payment and securities settlement facilities and ensure the manufacture, issue and post-issue handling of euro banknotes. They also collect statistics for the ECB, collaborate with the ECB on translation and the production of publications and contribute to economic analysis and research.

The supervisory model is relevant from many standpoints, since it may have a bearing on how efficiently and effectively the goals pursued are attained and ought to resolve possible conflicts of interest across the different areas supervised. In this connection, it should be noted that, after the 2008 global financial crisis, some countries have changed their supervisory models, broadly speaking, by adopting more integrated models and increasing the role of central banks. Among these integrated models I wish to highlight one structured around two separate bodies: a central bank,13 charged with prudential supervision, i.e. the solvency of banks, securities firms and insurance companies, and a second body to oversee all intermediaries’ conduct and protect the investors and customers of various financial products and services. 11  The Directors General, the staff representative and the General Secretary of the Banco de España also attend the Governing Council’s meetings in a non-voting capacity. In addition, the General Secretary acts as the Governing Council's secretary. 12  For a more detailed discussion on this matter, see F. Restoy (2016), La organización de la supervisión financiera, or J. Segura (2018), “La supervisión financiera”, Chapter 3 of Reguladores y supervisores económicos independientes: el caso español, coordinated by J. Segura. For a recent description of supervisory models around the world, see D. Calvo, J.C. Crisanto, S. Hohl and O. Pascual Gutiérrez (2018), “Financial supervisory architecture: what has changed after the crisis?”, FSI Insights on policy implementation, No 8.