On 26 March 2018, the European Central Bank (ECB) published its Annual Report on supervisory activities 2017.

In her introductory interview to the Annual Report, Danièle Nouy (Chair of the Supervisory Board, ECB) discusses, among other things, Brexit mentioning:

“But the changes triggered by Brexit go beyond the relocation of some banks that operate from the UK. As supervisors, we have to think about cross-border banking groups more generally: how can we ensure that they are well supervised, that they are resolvable? This will not only affect banks that operate from the UK, but also banks that operate from any other third country. And it may also affect European banks that operate outside the EU.”

The ECB has also published an introductory statement by Danièle Nouy. In her statement Ms Nouy discusses the ECB’s work on non-performing loans (NPLs), the targeted review of internal models (TRIM), Brexit, thematic reviews and less significant institutions.

In terms of Brexit Ms Nouy states:

“Regarding the preparations for Brexit, the ECB is closely monitoring the relocation plans of banks. We see an increase in the number of banks taking decisions on their Brexit plans and starting to relocate to the euro area. We are also continuing to work on policy stances to ensure that banks are adequately prepared for Brexit and have suitable governance structures, are well managed and have a sustainable business model for their entities located in the banking union. We have communicated the time needed for supervisors to process applications. For those banks wishing to relocate to (or expand activities in) the euro area and needing an authorisation for their (expanded) activity post-Brexit, the ECB and national supervisors expect to receive authorisation applications as soon as possible but at the very latest by Q2 2018, if not already submitted.”