Memorandum of Understanding between the Polish and German Bank Supervisory Authorities
The Commission for Banking Supervision concluded on the 20 December 2004 a Memorandum of Understanding with the German banking supervisory authority Bundesanstalt für Finanzdienstleistungsaufsicht specifying the principles and the cooperation procedure between both of these supervisory authorities and specifically the principles for the exchange of information on the supervised banks and the conduct of inspection within these banks.
This is the first memorandum of understanding concluded by the Polish supervisory authority with the supervisory authority of a state which is a member of the euro area. The memorandum specifies the standards which will be obligatory during the conclusion of further memoranda by the Commission for Banking Supervision with financial supervisory authorities of member states of the euro area.
The establishment of specific principles for cooperation will allow, amongst others, the conduct of joint examinations by the supervisory authorities in both countries at banks that are dependent on entities having their seat on the territory of the other state. The memorandum is especially relevant for Poland because twelve of the banks operating in Poland that are controlled by German capital amount to nearly one-fifth of the assets of the Polish banking sector.
The memorandum develops and makes more precise the principles for the up to now cooperation. It allows a wide scope for mutual exchange of information on the situation of not only the dependent bank but also of the entire group to which the bank belongs and the possibility for the participation of the supervisor of the dependent bank in inspections conducted at the parent bank.
The conclusion of the memorandum will undoubtedly contribute to an increase in the security of both the banks that remain under the supervision of Polish supervisory authority and those under German supervisory authority.