The ECB’s accountability within the SSM framework: Mind the (transparency) gap

With the establishment of the Banking Union, the European Central Bank has become the main banking supervisor within the framework of the Single Supervisory Mechanism. Unlike monetary policy tasks, which the European Central Bank performs in line with numerically set objectives, supervisory ones are more difficult to quantify. At the same time, supervisory decisions entail a margin of discretion, which opens the way for potential ‘political interferences’ within the supervisory process. Considering that in supervision the European Central Bank disposes with the same level of independence as in monetary matters, concerns emerge on how to secure the European Central Bank’s accountability in this domain. Indeed, recent reports by European Union actors have warned about a ‘transparency gap’ undermining the European Central Bank’s accountability within the Single Supervisory Mechanism. This contrasts the European Central Bank’s monetary policy practice where transparency has been consistently prioritized over time with positive outcomes. This article highlights the shortcomings in respect of European Central Bank’s supervisory transparency by reviewing standards and practices in the monetary and supervisory domain. Arguing that transparency is salient to the European Central Bank’s accountability within the mechanism’s multilevel governance framework, the paper suggests potential enhancements of existent information channels in line with the unique requirements of supervision