In keeping with the international standards that are currently being elaborated, Germany’s governing coalition proposed expanding the macroprudential oversight of the German financial system at its central bank. I understand that work is underway to draw up legislation based on this proposal – a development which I very much support.
Central banks are especially suited to the macroprudential aspects of financial supervision because they already have a duty to maintain a constant overview of market developments. As I’ve already mentioned, central banks are also aware of the side effects of regulatory initiatives.