In the Europan Union, the supervision of the financial system (at the European Monetary Union) is carried out by the European Central Bank, directly in the case of institutions considered significant, and through the national central banks, in the rest of the financial institutions as well as other members of the financial system such as payment institutions, electronic money institutions or appraisal companies.
The system of the European Monetary Union lies on two fundamental pillars (pending the entry into operation of the third), such as the Single Supervisory Mechanism (SSM) and the Single Resolution Mechanism (SRM) and based on regular audits of supervised institutions. The main objective is that these institutions comply with the European legislation determined through Directives that have to be adapted by each of the EU Member States. In some cases, regulations are also directly applied.
In recent times, the possibility of replacing this system of Directives with a single and general Regulation for all European financial systems, mainly those of the Eurozone, has been considered, and thus avoiding the distortions that occur in the implementation of Directives.
However, this is not the only supervision system that exists. In the United States, for example, it is much more complex, since they have both national institutions, obliged to adhere to the FED (US Federal Reserve), and State institutions. Each of them has a supervisory system, which also has legislative powers.
