The measures that the European Central Bank is beginning to develop to deal with the problem of non-performing loans in banks' portfolios could also be extended to credit institutions not directly supervised by Frankfurt at a later stage. This was stated by the head of ECB supervision, Daniele Nouy, in a written response to the interpellation of an Italian member of the European Parliament.
“The ECB is currently working on a coherent framework of supervisory tools – reads the text – in relation to the management and disposal of 'non-performing loans' to be applied to the main institutions. An extension of the scope of the exercise to smaller banks which remain under the respective national supervisory authorities will only be discussed in the competent forum at a later stage”.
The ECB is currently responsible for the direct supervision of the top 129 lenders in the euro area, while the smaller ones still answer to the national authorities. Frankfurt is working on the development of new guidelines that require banks to reduce the non-performing portfolios, especially in countries such as Italy, Greece and Portugal.
