Section 23B requires that inter-affiliate transactions be at arm’s length and on market terms, and imposes other restrictions designed to limit conflicts of interest. Thus, affiliate status prevents the bank from passing along the federal subsidy inherent in the federal safety net to its section 20 affiliate by extending credit.
Today, we provided you with the first quarterly report on the SSM, and Danièle Nouy will discuss it here in Strasbourg tomorrow. Honourable members, I have only mentioned two of the aspects that we are currently dealing with in preparation of our new supervisory tasks.