vitor constancio : implications of the single supervisory mechanism ( ssm ) on the european system of financial supervision ( esfs ) speech by mr vitor constancio, vice - president of the european central bank, at a public hearing on financial supervision in the eu, brussels, 24 may 2013. * * * ladies and gentlemen, thank you very much for inviting me to open this session on the implications of the single supervisory mechanism ( ssm ) on the european system of financial supervision ( esfs ). at present, the only answer that can really be given on this issue is, “ it depends ”. while the ssm will in principle be just another supervisor around the table, its impact on the esfs will clearly depend on how many member states eventually decide to join. in our view, the more member states take part, the better it will be for the functioning of the esfs and the single market more generally. first, having as many as possible countries in the ssm will reduce the scope for coordination failures. this will in turn facilitate the coordination function of the european banking authority. second, a larger ssm is the best way to safeguard the single market in financial services. the more membership overlaps between the eu and the ssm, the more consistent will be the application of supervisory and regulatory practices. third, broad ssm membership could diminish the distortions to the single financial market caused by the divergent fiscal positions of sovereigns, as member states that are part of the ssm will also have access to the single resolution mechanism ( srm ). this presupposes, however, that the srm is set up with strong powers, which i consider essential. at this stage, we expect several non - euro area member states to join the ssm. the negotiations on the ssm regulation have satisfactorily addressed most of their concerns. however, some countries seem to require that more clarity on the functioning of the srm is provided before they reach their final decision, in particular on the issue of a common fiscal backstop and how “ out ” member states could contribute to or benefit from it. in my view, this should not be an obstacle to a positive decision because any participant country in the ssm will also participate in the srm and benefit from it. from the ecb ’ s perspective, it is essential that the srm comprises a single resolution authority and single fund financed by ex - ante and risk

yves mersch : the overhaul of the architecture of the euro area and the return of investor confidence speech by mr yves mersch, member of the executive board of the european central bank, at the cfa institute european investment conference “ beyond austerity – opportunities for european investors in the global market ”, london, 15 november 2013. * * * introduction it is a great pleasure to join you at the sixth annual european investment conference and to have this opportunity to talk to investment professionals. i would like to discuss the return of confidence in the euro that we have observed over the past year. in particular, i would like to show that recent financial market developments confirm the credibility of the reform actions taken at european and national level. we can clearly see that investor confidence is slowly returning, that the persistent euro area financial market fragmentation is decreasing and that contagion is receding. this does not mean that the euro area and its member countries can rest on their laurels, as some efforts are still needed to bring an end to the crisis and to put economic and monetary union ( emu ) on a stronger footing. building a stronger emu before looking at these encouraging market developments, let me briefly recall the causes of the euro area crisis and the policy actions taken at european and national level to address the economic imbalances and financial vulnerabilities. as the crisis has shown us : the original design of the euro has been incomplete. it became clear that the euro area lacked certain institutional elements which are essential to federations with a single currency. three of these shortcomings were particularly acute and contributed to the euro area sovereign debt crisis : first, the maastricht treaty was a child of its time. it reflected the ambient overreliance on the disciplinary effects of markets. fiscal policies remained at national level. the stability and growth pact provided rules to mitigate this situation but their implementation by the council of ministers often lacked traction and facilitated fiscal indiscipline. second, macroeconomic imbalances often precede fiscal disequilibria. but the treaty only provided for a vague coordination of economic policies which on top were not determinedly pushed by the commission. third, europe lacked a coherent approach to financial sector policies. regulatory frameworks and financial policies remained insufficiently harmonised and centralised, neglecting the increasing level of financial integration in the euro area. in this respect, there was no level playing field for european banks and, in particular, there was no institutional framework