Michael McGrath (Cork South Central, Fianna Fail)
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273. To ask the Minister for Finance his views on the performance of the European Central Bank in regard to its role in respect of the prudential supervision of credit institutions as laid out in article 127(2) of the Treaty on the Functioning of the European Union in recent years; and if he will make a statement on the matter. [4826/15]

Michael Noonan (Limerick City, Fine Gael)
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The tasks of the European System of Central Banks (ESCB) and the Eurosystem are laid down in the Treaty on the Functioning of the European Union (TFEU). They are specified in the Statute of the European System of Central Banks and of the European Central Bank. The Statute is a protocol attached to the TFEU.

The Deputy refers to Article 127(2) of the TFEU which defines the basic tasks to be carried out through the Eurosystem to be:

- to define and implement the monetary policy of the Union

- to conduct foreign-exchange operations consistent with the provisions of Article 219 of the TFEU

- to hold and manage the official foreign reserves of the Member States

- to promote the smooth operation of payment systems.

The ECB is independent in carrying out its mandate and tasks. However, accountability is an important counterpart of its independence. As a European institution, the ECB is accountable in the first instance to the European Parliament.

The President of the ECB regularly reports on the ECB's monetary policy and its other tasks at his hearings before the European Parliament Committee on Economic and Monetary Affairs. Other members of the ECB's Executive Board also appear before the European Parliament to address specific issues. Beyond that, the ECB replies to written questions by MEPs, which are published together with the ECB's answers in the Official Journal of the EU and on the ECB's website.

As part of the ECB's reporting obligations, the President also appears before the plenary session of the Parliament to present the ECB's Annual Report, on which Parliament, as a rule, adopts a resolution.

The Central Bank of Ireland is a member of the Eurosystem, which consists of the European Central Bank (ECB) and the National Central Banks (NCBs) of the nineteen Member States that have adopted the euro. This group of institutions is responsible for conducting and implementing the single monetary policy for the currency union with the primary objective of maintaining price stability. Further details of the Central Bank's involvement in monetary policy formulation at Eurosystem level are set out in its Annual Report.

In addition to its monetary policy role, on the basis of Article 127(6) of the TFEU and of the Council Regulation (EC) No 1024/2013 (the "SSM Regulation"), the ECB is responsible for specific tasks concerning the prudential supervision of credit institutions established in participating Member States. It carries out these tasks within a Single Supervisory Mechanism (SSM) composed of the ECB and the national competent authorities. The SSM is responsible for the prudential supervision of all credit institutions in participating Member States. It confers key supervisory tasks on the ECB and establishes the framework in which the ECB and the national competent authorities, including the Central Bank of Ireland, are to co-operate on the prudential supervision of credit institutions.

The SSM took effect from 4 November 2014, and it is early days yet to be making judgement on its performance. In line with the SSM Regulation the ECB is required to report to Council and to Parliament on an annual basis in relation to the execution of the tasks conferred on it. In addition there is democratic accountability at both the European and national levels. National parliaments of the participating Member States, through their own procedures, may request the ECB to reply in writing to any observations or questions submitted by them to the ECB in respect of the tasks of the ECB under the SSM Regulation. The national parliament of a participating Member State may also invite the Chair or a member of the Supervisory Board to participate in an exchange of views in relation to the super­vision of credit institutions in that Member State together with a representative of the national competent authority.