[VIENNA] Fragmented and sometime overly restrictive national rules can keep the European Central Bank from helping struggling banks before they are at risk of failing, the European Central Bank's supervisory chief said on Tuesday.
A European directive on banking resolution gives supervisors the power to take "early intervention measures", such as demanding changes to management and strategy, if an institution is struggling.
But the directive has been implemented inconsistently across the eurozone, said Danielle Nouy, the chair of the ECB's supervisory board, and sometimes the bar for early intervention has been set too high.
"When we look at the conditions to (intervene), based on the different implementation of the recovery and resolution directive, the conditions are quite different," Ms Nouy said at an event in Vienna. "In certain cases, I don't quite see how we could take early intervention measures before the bank has almost disappeared."
The ECB took over supervision of the region's largest banks late last year and is due to set capital requirements for the banks under its watch. Common supervision is one of three pillars of the eurozone's banking union, along with a single resolution authority and a common deposit guarantee.
With the former two already in place or being implemented, Ms Nouy said, the introduction of a single guarantee on European bank deposits would take some time.
"It would be something nice to have, but I'm quite satisfied already with the current situation," Ms Nouy said during a panel discussion. "Solidarity is not yet there - it will take some time."
She was responding to fellow panelist and Erste Group Chief Executive Andreas Treichl, who had said earlier he was no longer expecting the scheme to come to fruition.