ECB Annual Report on supervisory activities

Table 5
Most authorisation procedures notified to the <strong>ECB</strong> concern fit and proper assessments 25
Licensing Withdrawal of licence Lapsing of licence Qualifying holdings Fit and proper Passporting
2014 2015 2016 2014 2015 2016 2014 2015 2016 2014 2015 2016 2014 2015 2016 2014 2015 2016
7 37 24 5 26 42 0 26 178 9 134 142 115 2,729 2,544 34 431 252
Note: In previous <strong>ECB</strong> annual reports on supervisory activities, withdrawals and lapsing procedures were reported together. Owing to the increase in lapsing cases, the procedures
are now reported separately.
The number of passporting
procedures decreased owing to
improvements in the notification
process
In the case of passporting procedures, the significant decrease mainly results from
improvements in the notification process. NCAs can now include in one single
procedure information regarding multiple passports for the same supervised entity or
set of services. Without this improvement, the overall number of passporting
procedures would have been similar to last year’s.
Developments in common procedures
With regard to licensing, there are
more business models that
integrate traditional banking
services with mobile devices
Most licensing procedures related to existing credit institutions that either needed to
restructure (e.g. a merger or split-up of banks/banking groups, generating the need
for a new entity to be licensed) or to extend their licences following proposed
changes in the activities undertaken. Among the completely new banks that were
licensed, an increase was observed in business models which integrate traditional
banking services with mobile devices. This trend reflects the stronger focus on
technological innovation in the banking sector. Examples of such FinTech business
models were the introduction of an online bank product aimed at technology
providers wishing to offer products with integrated banking services and the
insourcing of banking services via mobile solutions.
Withdrawal and lapsing procedures largely arise from credit institutions voluntarily
terminating their banking activities or from banks that enter into a merger or
undertake a restructuring. Nonetheless, a limited, but relevant, number of withdrawal
procedures were triggered by (non-voluntary) liquidation or resolution of the
institutions concerned (all of which were LSIs).
To a large extent, qualifying holding procedures, as in 2015, related to mere internal
reorganisations (e.g. intra-group consolidations), often reflecting cost-cutting policies.
Other qualifying holding procedures concerned acquisitions of stakes in banks by
equity funds and sovereign funds, involving particular aspects relating to complex
corporate structures, possible short-term investment horizons or the use of
leveraged funding (specific acquirers 26 ).
25
26
As the cut-off date for 2014 was 15 January 2015, there is a limited overlap between the numbers for
2014 and 2015.
“Specific acquirers” are characterised by complex corporate structures, non-transparent corporate
governance, short-term investment strategies or the use of substantial debt or quasi-debt funding (e.g.
private equity funds).
<strong>ECB</strong> <strong>Annual</strong> <strong>Report</strong> on supervisory activities 2016 − Authorisations, enforcement and
sanctioning proceedings 36