Opting for the central bank as a national macroprudential authority can be warranted by the experience accumulated in the field, especially in the case of a dominant position of the banking sector, and by the possibility of a quick implementation of adopted measures (since the institution is responsible for identifying systemic risks and, at the same time, has available the macroprudential tools to put into practice the measures considered adequate). Some disadvantages of having supervision integrated in the central bank are manifest in this case as well, such as the backfiring of potential errors in the area (be they real or merely perceived as such by the public) on monetary policy credibility or a keener interest in politically capturing the institution as a result of the substantial rise in central bank powers. As Klaas Knot has showed more than once, the key argument in favour of creating a board is that it enables the pooling of the expertise of all financial market supervisors and of the government; the drawbacks would be more diffused accountability and the risk of delayed implementation of recommendations, given the involvement of several institutions. A prominent role of the central bank in the board (either by chairing it or through the number of members assigned) might mitigate the risk of inaction.
Coming to the current NBR governance framework, I would like to start by pointing out that it ensures a complete separation as regards the coordination of the relevant departments: while the Governor is in charge of the monetary policy area, the First Deputy Governor coordinates the Supervision Department; one Deputy Governor takes care of financial stability and the other, of bank resolution. The nine-strong Board of Directors runs the central bank, but the process of preparing its decisions in the areas of monetary policy and prudential supervision takes place in two distinct structures: the Monetary Policy Committee and the Supervisory Committee, respectively, which comprise members of the executive management and experts in the relevant areas. As separation is not the same thing as complete isolation, I have to add that both committees are chaired by the Governor... Pursuant to the NBR Statute, the Board is tasked to act as a first appellate forum for sanctions on credit institutions. In order to avoid conflicts of interest that may appear, the following institutional arrangements are in place: separate Board meetings, a certain degree of autonomy of the Supervision Department and recusal from the proceedings of the First Deputy Governor, in his capacity as coordinator of the Supervision Department. 2  BIS central bankers’ speeches  I would like to add a special remark regarding the new role of the NBR as the resolution authority, arising from the provisions of the Bank Recovery and Resolution Directive.