Улога Европске централне банке у надзору над финансијским системом
The role of the European Central Bank in supervising the financial system

Summary/Abstract: The author of this paper tries to give an explication of the role of the European Central Bank and its activities over the financial system. At the EU level there are currently three different supervisory systems in the financial market: (1) the single supervision model; (2) the model par objectives; (3) the model par actives; Former principle of that control is exercised by the country of origin, even when the financial intermediary shall perform the duties of another country, proved to be inefficient due to the frequent inability to embrace the business of financial intermediaries. Achieving high levels of compliance is an essential precondition for the creation of an integrated market in which the same conditions apply to all financial intermediaries and providing an adequate level of investor protection. The European Central Bank is currently the only institution at EU level that could supervise the entire financial sector or, at least, the supervision of banks. It is believed that the introduction of the single currency, in the absence of a single institutional framework for the supervision of the financial system reduces the level of protection. It especially reduces efficacy in preventing financial crises and mechanism of its solving. Given the current situation in the European financial market, where the number of crossborder financial conglomerates on the rise, the principle of control by the country of origin seems inadequate. The link between monetary policy and financial sector supervision is evident by looking at the composition of the ECB Executive Board, which consists of the governors of the central banks of member countries.

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