Why is the single European supervisor model not adopted (i.e., full centralisation of supervision at the EU level)?
A single supervisor would amount to a complete overhaul of the present arrangements and it is doubtful whether such an approach would be effective. Supervision has to be carried-out in close contact, on the ground, with the supervised entities. At this stage it is not realistic that over ten thousand financial institutions could be supervised at the EU level. For major cross-border institutions, moving supervisory responsibilities to the EU level would mean resolving all the issues related to burden sharing, which at this stage is not realistic. Furthermore, there is no evidence to support the idea that a single supervisor would do a better job than effective colleges of supervisors, working closely with European Authorities.
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