To achieve these tasks, the ESRB will draw on information from many sources, including strong analytical input from its members; intelligence gathered from financial system participants; and the data necessary to understand the nature of the intricate interlinkages that define the financial system. ESRB analysis must be broad-based covering potentially any aspect of the EU’s financial system – markets, institutions and infrastructure.
In particular, it should extend to those areas of activity that reside outside the usual regulatory scope, often referred to as the “shadow” system. The ESRB does not have binding powers per se. It must convince through the quality of its work. To achieve credibility, it must ensure that warnings are well-timed and that recommendations are specific and well-targeted.