ECB Watchdog Left Waiting as Mersch Faces Deja Vu of Vote Limbo
ECB Watchdog Left Waiting as Mersch Faces Deja Vu of Vote Limbo
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The nomination of Yves Mersch as next vice chair of the euro area’s banking watchdog won’t be formalized for months, delaying the European Central Bank’s effort to fix a gaping hole in its governance.
Lawmakers in Brussels who get a binding vote on the appointment won’t take the decision before the European Parliament election at the end of May, Roberto Gualtieri, the chairman of the assembly’s Economic and Monetary Affairs Committee, said in a text message. That means it becomes the responsibility of the new parliament, which only starts its activities in July and may need some time to be fully up and running.
Mersch, a member of the ECB Executive Board, was nominated by the Governing Council on Tuesday, following two months of inaction after his colleague, Sabine Lautenschlaeger, finished as vice chair of the Single Supervisory Mechanism. That temporarily removed a formal link between the panels running the ECB and the bank watchdog.
In the absence of a successor to Lautenschlaeger, ECB President Mario Draghi took on some of the associated responsibilities in the interim in addition to his own. Without a confirmation by the EU parliament and the bloc’s member states, Mersch can only take on some internal tasks without playing an operational role in the supervision of banks, according to an official with knowledge of the matter.
Mersch’s appointment also underscores the ECB’s struggle to achieve gender balance at the highest level. The current EU parliament has vocally criticized the lack of women in senior financial positions, meaning the point might well be raised again during the confirmation process.
Until this year, when SSM Chair Daniele Nouy was replaced by Italy’s Andrea Enria and Lautenschlaeger ended her term, the top two positions at the supervisor had been filled by women. Since Lautenschlaeger is the only woman on the ECB Executive Board, from which the vice chair of the Supervisory Board has to be picked, the further weakening of the gender balance was inevitable.
It wouldn’t be first time Mersch faces such an obstacle. His appointment to the ECB Executive Board was held up for months by lawmakers dissatisfied at governments’ repeated nominations of male candidates in an organization already predominantly run by men.
The SSM directly oversees almost 120 significant banks operating in euro-zone member states. A potential deal between Deutsche Bank AG and Commerzbank AG would mark it biggest test to date since it started overseeing lenders less than five years ago.
The ECB also decided to advertise for the other three available positions on the board of the watchdog, according to an announcement on Friday. Two of those seats have been unfilled for more than 1 1/2 years.
--With assistance from Piotr Skolimowski.
To contact the reporters on this story: Alexander Weber in Brussels at aweber45@bloomberg.net;Carolynn Look in Frankfurt at clook4@bloomberg.net
To contact the editors responsible for this story: Dale Crofts at dcrofts@bloomberg.net, Zoe Schneeweiss, David Goodman
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