Memoranda of Understanding (MoUs) on supervisory matters are agreements signed by supervisory authorities establishing the terms of a communications and collaboration protocol between those authorities in relation to regulated issues of common interest, such as intervention powers, information sharing, cooperation and the management of potential crisis situations.
The Banco de España has signed bilateral and multilateral MoUs with various Spanish and foreign authorities.
International bilateral MoUs within the EU
These arrangements originated as a result of implementing the supervisory, cooperation and communication rules set out in the Second Banking Directive (Directive 89/646/EEC), which is now no longer in force. Today, they are included in Directive 2013/36/EU (see Articles 55 et seq.
), and, in principle, implement this directive. As such, they basically apply to branches, and have been signed with countries where, at the time, there were branches of some importance to either of the two parties.
These MoUs specify how supervisors must notify each other, and the content of such notifications, when branches are opened, and how they are to cooperate in supervising liquidity and market risks. They also establish the reporting requirements of the host country supervisor and different aspects regarding cooperation in the supervisory tasks.
MoUs have been signed with the following EU countries:
- Belgium (1993)
- France (1993)
- Germany (1993)
- Italy (1993)
- Luxembourg (1995)
- The Netherlands (1994)
- Portugal (1993)
- Romania (2010)
Moreover, various MoUs have been signed under Article 115 of Directive 2013/36/EU (currently incorporated into Spanish legislation under Article 62 of Law 10/2014), to facilitate and establish effective supervision of European groups of credit institutions
Other international bilateral memorandums of understanding outside the scope of the EU
The existence of Spanish banking groups conducting financial activities in non-EU countries through local subsidiaries (and, potentially, vice versa) calls for a better mutual understanding of both the banking system and the supervisory domain in the other country and for enhancing cooperation and information sharing between their prudential supervisory authorities, to ensure the best exercise of their respective responsibilities and functions. With these objectives in mind and in accordance with the Core Principles for effective banking supervision issued by the Basel Committee on Banking Supervision in 1997 (revised in 2006 and 2012), the Banco de España has signed bilateral agreements with the supervisory authorities of non-EU countries. These agreements set out, among other aspects, the reasons advising the arbitration of cooperation procedures, the general allocation of the supervisory responsibilities between the host and home supervisors, the minimum content for information sharing, the confidentiality provisions prevailing in each country, the criteria for performing on-site inspections of subsidiaries – under exceptional circumstances – by the home supervisor, and general aspects related to technical collaboration, operational contacts and bilateral meetings.
Such arrangements have been signed with the following countries:
- Latin American:
- Argentina (1998)
- Brazil (2002)
- Chile (1998)
- Colombia (1998)
- Mexico (2000, including amendment in 2014)
- Peru (1998)
- Puerto Rico (2008)
- Uruguay (2005)
- Venezuela (1998)
- Other non-EU countries:
- Andorra (2011)
- People's Republic of China (2006)
- Switzerland (2021)
- Turkey (2013)
- United Kingdom (2019)
- United States of America (2008)
- United States of America (SEC) and CNMV (2021)
- Vatican City (2021)
National agreements
Within Spain, the Banco de España has signed bilateral MoUs with different authorities on supervisory matters. These MoUs seek to standardise the exchange of information and to improve the efficiency, effectiveness and quality of supervisory procedures. The Banco de España has signed MoUs with the following national authorities:
- National Audit Office (IGAE), in relation to the control and supervision of the Official Credit Institute (ICO) (2009).
- Directorate General of Insurance and Pension Funds of the Ministry of Economic Affairs (2004).
- National Securities Market Commission (CNMV) (2009).
- Commission for the Prevention of Money Laundering and Monetary Offences (2021).
- Fund for Orderly Bank Restructuring (FROB) (2021).
Multilateral memorandums of understanding within the European Union
As part of the EU's and, more specifically, the European Central Bank's efforts to achieve greater financial stability and develop the cooperation and coordination between financial authorities in order to both prevent and resolve potential crises, they have fostered the signing of various collaboration agreements, to which the Banco de España is party:
- Memorandum of cooperation between competent authorities for the performance of their supervisory tasks in relation to the supervision of Third-Country Groups and Third-Country Branches (2024).
- Memorandum of Understanding between the financial supervisory authorities, central banks and Finance Ministries of the European Union on cross-border financial stability (2008), which was extended to all European Economic Area countries in 2010.
- Memorandum of Understanding between banking supervisory authorities, central banks and the Finance Ministries of the European Union in financial crisis situations (2005).
- Memorandum of Understanding on high-level principles of co-operation between the banking supervisors and central banks of the European Union in crisis management situations (2003).
- Memorandum of Understanding on the exchange of information among national central credit registers for the purpose of passing it on to reporting institutions (2003).
- Memorandum of Understanding on cooperation between payment systems overseers and banking supervisors in Stage Three of Economic and Monetary Union (2001).