Europäische Zentralbank

Wishing you all a joyful festive season!

Our Graduate Programme in Economics is now open for applications! We spoke to two former graduate economists about their experiences. 💬 Laura shared that she enjoyed the diverse assignments: “In the first year, I worked in banking supervision and looked at systemic risk in the financial system – quite different to what I was studying in my PhD.’’ 💬 Catalina explained why she applied: “I applied to the programme to gain experience in various areas of the ECB and to work closely with leading experts on topics related to monetary policy and inflation.” She added: “The highlight of the programme was that I could apply the analytical skills I learned during my PhD to address relevant policy questions for the ECB.” 📅 Applications close on Monday, 6 January – don’t miss out! Want to learn more and apply? 👉 https://lnkd.in/g35vrZJF

🔍What impact could President Trump’s tariffs have on the economy? 📈 What should Europe do to become more competitive? 💶 And how has the ECB’s monetary policy shifted recently? 🎙️ Our host Paul Gordon discusses these topics and more with Chief Economist and Executive Board member Philip R. Lane in the latest episode of #TheECBPodcast. Listen now https://lnkd.in/e6WNE_qj

💶 Cash, card or digital: what’s the most common way to pay in the euro area in 2024? What do people think about different payment methods and how accessible they are? 🔹 Our latest study on the payment attitudes of euro area consumers offers insights into payment behaviours across the 20 euro area countries, now including Croatia for the first time since adopting the euro in 2023. 🔹 The study sheds light on people’s payment preferences and the perceived advantages of different payment methods. 🔹 It also examines the acceptance of cash and electronic payment methods in stores. Swipe ⬅️ to explore our main findings! Want to know more? Check the full study https://lnkd.in/e4EZm7SG

Congratulations to Karin Turner-Hrdlicka who will join us next year in March to take the helm of our On-site and Internal Model Inspections department. We look forward to working together. Read the press release https://lnkd.in/gVNWjHY5

🌍 Addressing the insurance protection gap for natural catastrophes in Europe: a joint approach   Today, together with the European Insurance and Occupational Pensions Authority (EIOPA), we published a paper proposing an EU-level approach designed to mitigate the economic impact of natural catastrophes. This initiative is our response to the increasing frequency and severity of natural disasters driven by climate change, which are expected to widen the existing insurance protection gap.   The proposed EU-level framework builds on existing national and EU structures, and consists of two complementary pillars:   1️⃣ An EU public-private reinsurance scheme. This would increase insurance coverage by pooling private risks across the EU, funded by risk-based premiums from (re)insurers and national insurance schemes. By taking advantage of economies of scale, this scheme would diversify high-risk coverage at European level, making insurance against natural catastrophes more accessible and affordable.   2️⃣ An EU fund for public disaster financing. This would strengthen public disaster risk management and support the rebuilding of infrastructure after disasters. Crucially, it would incentivise proactive risk mitigation measures, making Europe more prepared and resilient.   As ECB Vice-President Luis de Guindos highlighted, this two-pillar approach could be key to reducing the macroeconomic and financial stability risks associated with natural catastrophes. The first pillar sets out a structured path to incentivise private insurance coverage, while the second would provide financial support to Member States in times of need, subject to concrete and pre-agreed risk mitigation measures.   Read the paper https://lnkd.in/dBbuRP4m

European banks have solid capital and liquidity positions and good profitability, our Supervisory Review and Evaluation Process (SREP) – banks’ annual health check – shows. Overall, banks’ SREP scores and Pillar 2 requirements for Common Equity Tier 1 capital remained broadly stable. Looking ahead, our 2025-27 supervisory priorities focus on strengthening banks’ resilience against macro-financial threats and geopolitical shocks. The main areas of focus are credit risk management, operational resilience and digitalisation, as well as the effective and timely remediation of supervisory measures. To learn more: 👉 read the press release https://lnkd.in/eAJ45chG 👉 read Supervisory Board Chair Claudia Buch’s introductory remarks at the press conference https://lnkd.in/eBP_akUg 👉 discover our supervisory priorities for the next three years https://lnkd.in/eiNT8e6P

Monetary policy should proceed gradually and remain data-dependent, says Executive Board member Isabel Schnabel at #CEPRParis2024.   Once price stability is restored, central banks can be more tolerant of moderate deviations of inflation from target, in both directions. Read the speech https://lnkd.in/e-TxjtxU

🔍 What are periodic penalty payments?   They are an enforcement measure the ECB can use to get banks to comply – as quickly as possible – with requirements in supervisory decisions and regulations. If imposed, the bank has to pay a penalty for every day that it fails to fulfil a requirement, for a maximum of six months.   How do they work?   Stage 1️⃣- the ECB issues a decision outlining specific actions that a bank must take to fix an identified shortcoming by a set deadline.   Stage 2️⃣– if the bank complies, no further measures are needed. If it doesn’t, periodic penalties may begin accruing either automatically or following a separate ECB decision. The amount that the bank ultimately needs to pay increases with every day that it doesn’t comply.   Stage 3️⃣– once the bank complies or the six-month period lapses, the ECB drafts a final enforcement decision, allowing the bank to comment before it’s formally adopted.   Stage 4️⃣– once the decision is finalised, details are published on the ECB’s website about the breach and the final amount of penalties to be paid. The bank has the right to appeal this decision.   If a bank still hasn’t complied after the legal maximum period, the ECB can use other measures in its supervisory toolkit to enforce its decisions, including sanctions.   Want to know more? 👉 Read our explainer in all EU languages https://lnkd.in/efW8FvZ7

Earlier this week we decided on monetary policy, determining what’s needed to return inflation to our 2% goal in a timely manner.     Tune in to #TheECBPodcast to hear President Christine Lagarde present the decisions in our press conference https://lnkd.in/e9-ixmvT