As such, these powers are related to what is usually called “prompt corrective action” regarding problematic banks and can be applied before the bank is delivered to the Resolution Authority. Another important competence conferred upon the ECB as the centre of the SSM concern the macro-prudential instruments to be possibly applied both to the euro-area financial system as a whole or to individual countries.
These powers are shared with national authorities that can also take measures in this field but it is nevertheless another essential element of the proposal. The crisis has shown that supervising the micro-prudential risks at individual banks separately is not sufficient and that macro- and micro- risks can actually be mutually reinforcing.