*** Banking Union The advent of ‘Banking Union’ and the establishment of the Single Supervisory Mechanism (SSM) in 2014 materially changed the supervisory landscape. The ECB took over ultimate responsibility for the supervision of all banks across the Eurozone and direct supervision of the largest 120 or so banks, including the five domestically active banks in Ireland (the ‘Significant Institutions’).
Whilst still in its early years, ECB Banking Supervision is a critical institutional step towards deeper integration in the euro area. As is evident from the presence of international banks here, banking does not stop at national borders and therefore a harmonised supervisory approach is necessary to reduce financial fragmentation and ensure a level playing field across the euro area.