The Structure of Financial Supervision in Europe: About Single, Twin Peaks and Multiple Financial Supervisors

Abstract

In Europe three models of financial supervision are being practised: a three pillar model (banking, insurance and securities), a two pillar model (prudential v. conduct of business) and an integrated model (all types of supervision under one roof). This paper gives an overview of the models followed in each of the European states, and analyses the characteristics of the different models. Although the choice for a specific model is determined by political, historical and path dependence factors, recently a trend for integration has become visible. The paper attempts to compare to pros and cons of the different models.

Keywords: financial supervision

JEL Classification: K2