Organization of the SSM and Banco de España

1.2 Organization of the Single Supervisory Mechanism (SSM)

The SSM comprises the ECB and the National Competent Authorities of the participating Member States. The ECB is responsible for the effectiveness and consistency of its operations.

For the organization of the supervisory function, credit institutions have been classified as "significant" and "less significant". The criteria for this classification are based on the size of each institution, its economic importance, the volume of its operations, and whether it receives financial assistance. In Spain, many institutions are integrated into 12 groups classified as significant. Smaller-sized banks, saving banks, and rural saving banks have been classified as less significant.

The ECB supervises the significant institutions. The ECB assigns a joint supervisory team, led by an individual from the ECB, to each institution to assess the institution's risk profile, solvency, and liquidity on an ongoing basis.

The national supervisory authority, in Spain, the Banco de España, supervises the less significant institutions. The ECB's supervision is only indirect, but it can issue guidelines, request additional information, or assume the direct supervision of these institutions.

1.3 Organization of the Banco de España

The following governing bodies are responsible for the management of the Spanish central bank:

• The Governor manages and represents the Banco de España. The Governor is a member of the Bank's Governing Council and Executive Commission, with a casting vote.
• The Deputy Governor stands in for the Governor when the latter's post becomes vacant or the latter is absent or ill. The Deputy Governor oversees the functions assigned under internal Bank rules.
• The Governing Council comprises the Governor, the Deputy Governor, six council members, the General Secretary of the Treasury and Monetary Policy, and the Vice-President of the CNMV. Its main functions include approving the general guidelines for the Bank's conduct, overseeing the Bank's contributions, and approving circulars.
• The Executive Commission comprises the Governor, the Deputy Governor, and two Council Members designated by the Governing Council on the Governor's proposal. Its main functions include contributing to implementing the monetary policy formulated by the Eurosystem and making decisions about authorizations for supervised institutions.

To manage these bodies, the Banco de España groups its employees into Units, then into Divisions, which make up Departments. Every three or four departments comprise a directorate general with uniform functions. The current directorates and their main functions are:

• Directorate General Cash and Branches: Its functions relate to issuing banknotes. It is responsible for producing, issuing, and placing into circulation the banknotes that correspond to the Banco de España.
• Directorate General Operation, Markets, and Payment Systems: Responsible for managing gold and currency reserves, managing financial risks, providing payment services, managing debt issued by the Treasury, and promoting and supervising payment systems.
• Directorate General Financial Stability, Regulation, and Resolution: Dedicated to analyzing and monitoring financial stability, drafting the Financial Stability Report, managing the Central Credit Register, and handling all preventive resolutions assigned to the Banco de España.
• Directorate General Banking Supervision: Responsible for performing the functions assigned to the Bank as the supervisory authority under the SSM.
• Directorate General Economics, Statistics, and Research: Conducts economic studies and research to advise the Bank's management and the Government.
• Directorate General Services: Responsible for managing and administering the internal services common to the entire Bank.
• General Secretariat: Acts as the secretariat of the governing bodies and provides legal advice to the institution.