- Bank supervision — Financial regulation — European Central Bank
This chapter discusses the position of financial conglomerates within the European banking union. Financial conglomerates are typically large and complex groups that combine banking and/or investment activities with other regulated and/or unregulated activities and usually operate across borders. The fact that their activities are not limited to banking activities raises interesting but a complicated question with respect to their regulation and supervision as conglomerates, in addition to the sectoral regulation and supervision these groups and the individual entities in these groups operate under. The background and evolution of financial conglomerates and conglomerate supervision are discussed, as well as the manner in which it is embedded in financial supervision in Europe. Furthermore, the evolution of the sectoral group and consolidated supervision is discussed, including the inception of the Single Supervisory Mechanism (SSM) and the challenges of supervision under the SSM. An additional layer of complexity is formed by the requirements that apply to resolution. The chapter concludes by reflecting on the complex interaction between the different sectoral frameworks, difference and inconsistencies between frameworks, specificities of the various sectors, and the need for a thorough assessment of the requirements that apply to conglomerates and their interaction.
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