Banking supervision

Strategic intents and supervisory priorities

The Single Supervisory Mechanism (SSM), the system of banking supervision in the euro area, became fully operational on November 4, 2014. In co-operation with the ECB and the OeNB, the Financial Market Authority (FMA) supervises Austrian banks, aiming to ensure financial stability. Significant institutions are directly supervised by the ECB, with OeNB, FMA and ECB staff engaging in close co-operation and forming Joint Supervisory Teams (JSTs). Less significant institutions (LSIs) are supervised by the FMA and the OeNB, Austria’s national supervisors, with ECB oversight providing a common framework.

The OeNB therefore operates in accordance with the strategic guidelines and organizational principles of the SSM. In particular, the SSM uses a risk-based approach to supervision. This means that the intensity of supervision is determined by the systemic importance and risk profile of the supervised bank in accordance with the principle of proportionality.

The SSM’s supervisory priorities are set annually on a rolling basis, each covering a multi-year period. For this purpose, the ECB, in collaboration with national supervisors, carries out an annual analysis of risks in the banking sector. The priorities for the following year are published on the SSM website and have a significant impact on operational supervisory activities. The OeNB’s and the FMA’s shared priorities for banking supervision are in line with the SSM’s priorities and are also published on an annual basis.