Edited by Robert Holzmann, Governor, Oesterreichische Nationalbank, Austria and Fernando Restoy, Chair, Financial Stability Institute, Bank for International Settlements, Switzerland

‘This volume provides a comprehensive and indispensable opportunity to take stock of the achievements and challenges of European banking supervision after the momentous reforms of the early 2010s, and on the related debates about financial supervisory architecture. While the complexity may at times appear dizzying, it is an important story whose policy lessons have relevance well beyond the boundaries of the euro area and European Union.’

• Contents:1 Introduction to Central Banks and Supervisory Architecturein Europe 1Robert Holzmann and Fernando RestoyPART I TRENDS IN EUROPEAN BANKINGSUPERVISION DESIGN2 The puzzle of Europe’s banking union: progress and missing pieces 14Thorsten Beck3 Supervisory architecture in the EU: where should we go from here? 21Fernando Restoy4 The architecture of supervision and prudential policy 34Angela Maddaloni and Alessandro Scopelliti5 Trends in European banking supervision design: is therea path to an optimal architecture for financial supervision inthe EU? 49Luís Silva MoraisPART II THE ROLE OF CENTRAL BANKS(I): ASPECTS OF MONETARY ANDMACROPRUDENTIAL POLICY INTERACTION6 Can macroprudential tools ensure financial stability? 62Anne Epaulard7 The interaction of monetary and financial tasks in differentcentral bank structures 71Aerdt Houben, Jan Kakes and Annelie Petersen8 Monetary and macroprudential policies: a troubled marriage 83Phurichai Rungcharoenkitkul9 The architecture of macroprudential policy: delegation andcoordination 96Charles Bean10 Governance of financial sector policies in an era of climate change 108Daniel C. HardyPART III THE ROLE OF CENTRAL BANKS (II):MICROPRUDENTIAL SUPERVISION ANDFINANCIAL STABILITY11 Entrusting central banks with microprudential supervision:implications for financial stability 122Anca Maria Podpiera12 Is this time different? Synergies between ECB’s tasks 135Karin Hobelsberger, Christoffer Kok and Francesco Paolo Mongelli13 Money, supervision, and financial stability: a money-creditconstitution entrusted to independent but constrained central banks 156Paul Tucker14 Politicians, central banks and macroprudential supervision 170Donato MasciandaroPART IV THE FINTECH REVOLUTION: IMPLICATIONSFOR OPTIMAL SUPERVISORY ARCHITECTURE15 Regulating and supervising BigTech in finance 181José Manuel González-Páramo16 The emerging autonomy–stability choice for stablecoins 194Maarten R. C. van OordtPART V LESSONS FROM THE COVID-19 CRISIS FORTHE OPTIMAL SUPERVISORY ARCHITECTURE17 Some lessons from COVID-19 for the EU financial framework 206Ignazio Angeloni18 Central banks as emergency actors: implications forgovernance arrangements 218David ArcherIndex

Edited by Robert Holzmann, Governor, Oesterreichische Nationalbank, Austria and Fernando Restoy, Chair, Financial Stability Institute, Bank for International Settlements, Switzerland

‘This volume provides a comprehensive and indispensable opportunity to take stock of the achievements and challenges of European banking supervision after the momentous reforms of the early 2010s, and on the related debates about financial supervisory architecture. While the complexity may at times appear dizzying, it is an important story whose policy lessons have relevance well beyond the boundaries of the euro area and European Union.’

• Contents:1 Introduction to Central Banks and Supervisory Architecturein Europe 1Robert Holzmann and Fernando RestoyPART I TRENDS IN EUROPEAN BANKINGSUPERVISION DESIGN2 The puzzle of Europe’s banking union: progress and missing pieces 14Thorsten Beck3 Supervisory architecture in the EU: where should we go from here? 21Fernando Restoy4 The architecture of supervision and prudential policy 34Angela Maddaloni and Alessandro Scopelliti5 Trends in European banking supervision design: is therea path to an optimal architecture for financial supervision inthe EU? 49Luís Silva MoraisPART II THE ROLE OF CENTRAL BANKS(I): ASPECTS OF MONETARY ANDMACROPRUDENTIAL POLICY INTERACTION6 Can macroprudential tools ensure financial stability? 62Anne Epaulard7 The interaction of monetary and financial tasks in differentcentral bank structures 71Aerdt Houben, Jan Kakes and Annelie Petersen8 Monetary and macroprudential policies: a troubled marriage 83Phurichai Rungcharoenkitkul9 The architecture of macroprudential policy: delegation andcoordination 96Charles Bean10 Governance of financial sector policies in an era of climate change 108Daniel C. HardyPART III THE ROLE OF CENTRAL BANKS (II):MICROPRUDENTIAL SUPERVISION ANDFINANCIAL STABILITY11 Entrusting central banks with microprudential supervision:implications for financial stability 122Anca Maria Podpiera12 Is this time different? Synergies between ECB’s tasks 135Karin Hobelsberger, Christoffer Kok and Francesco Paolo Mongelli13 Money, supervision, and financial stability: a money-creditconstitution entrusted to independent but constrained central banks 156Paul Tucker14 Politicians, central banks and macroprudential supervision 170Donato MasciandaroPART IV THE FINTECH REVOLUTION: IMPLICATIONSFOR OPTIMAL SUPERVISORY ARCHITECTURE15 Regulating and supervising BigTech in finance 181José Manuel González-Páramo16 The emerging autonomy–stability choice for stablecoins 194Maarten R. C. van OordtPART V LESSONS FROM THE COVID-19 CRISIS FORTHE OPTIMAL SUPERVISORY ARCHITECTURE17 Some lessons from COVID-19 for the EU financial framework 206Ignazio Angeloni18 Central banks as emergency actors: implications forgovernance arrangements 218David ArcherIndex