ECB clarifies supervisory criteria and process for determining suitability of banks' board members

The ECB has published a guide to fit and proper assessments of members of the management bodies of credit institutions under the direct supervision of the ECB. The guide is intended to establish transparent, common supervisory practices for assessing the qualifications, skills and proper standing of a candidate for a position on a bank's board. It includes the scope of the ECB's fit and proper assessments, as well as the legal framework and principles behind them. It then sets out guidance regarding assessment criteria, interviews, the assessment process, decision-making and the removal of members from the management body.

The ECB guide is in line with the draft guidelines of the European Banking Authority (EBA) and the European Securities and Markets Authority (ESMA) on the assessment of the suitability of members of the management body and key function holders. Any changes to those draft guidelines may lead to changes in the ECB guidance.