Supervision: what it is and how it works

The Bank of Italy supervises banks and non-banking intermediaries entered in specific registers. Since November 2014 this supervision has been conducted within the framework of the Single Supervisory Mechanism.

Supervisory activities are carried out by the Directorate General for Financial Supervision and Regulation at the Bank of Italy's Head Office in Rome and by its branch network.

In addition to on- and off-site inspections to verify compliance with the requirements for engaging in banking and financial activities, the Bank of Italy's supervisory action extends toactivities include the adoption of administrative measures. The most important measures involving banks are authorizations, sanctions, and those relating to the management of problematic situations.

As national supervisor, the Bank of Italy also provides a number of services directly to the public. It receives requests for information and analyses reports on irregularities involving supervised intermediaries, and publishes information on individuals or companies not authorized to carry out banking or financial activities in Italy and other more general notices and communications. It also conducts analyses on the banking and financial system.

The Bank of Italy performs supervisory tasks also for the purpose of protecting customers of intermediaries.

The Bank of Italy reports on its supervisory procedures and informs the public of the most important banking and financial issues through a variety of forums and channels, including the Annual Report and the Report on Operations and Activities of the Bank of Italy.

The Bank of Italy's supervisory powers have their legal basis in a regulatory framework that encompasses international, European Union and national laws.

Highlights

• 23 December 2024 - Communication to the market on ICT security
• 20 December 2024 - Notes on Financial Stability and Supervision No. 43 - Bad loan recovery rates in 2023
• 28 November 2024 - Notes on Financial Stability and Supervision No. 42 - Danger rate, the issue of the rating as a risk differentiation driver
• 24 November 2023 - Financial Stability Report No. 2 - 2024 - The world economy grew at a modest pace in 2024, with forecasts for 2025 pointing to continued sluggish activity, albeit with different trends across geographical areas. The wars in Ukraine and the Middle East and heightened geopolitical tensions still pose a risk to global economic and financial stability.
• 20 November 2024 - Notes on Financial Stability and Supervision No. 41 - Analysis of the impact of the SyRB activation on Italian banks' share prices
• 22 October 2024 - Digital resilience in the Italian financial sector - Banca d'Italia's analysis paper
• 22 July 2024 - Notes on Financial Stability and Supervision No. 40 - The new financial intermediaries licensed in 2021-23: trends and innovative models
• 13 June 2024 - Notes on Financial Stability and Supervision No. 39 - An analysis of debt securities issued and placed in Italy
• 30 April 2023 - Financial Stability Report No. 1 - 2024 - In 2023, the global economy slowed down and the growth forecasts for the current year, although revised slightly upwards, indicate that economic activity will remain weak overall. Over the past few months, the fall in inflation has come to a halt in the United States, while it has persisted in the euro area and the United Kingdom. There continue to be risks linked to the conflicts in Ukraine and the Middle East.
• 27 February 2024 - Memorandum of understanding between the Bank of Italy and Consob to strengthen their collaboration on supervised entities. The Bank of Italy and the Italian Companies and Stock Exchange Commission (Consob) signed a memorandum of understanding to facilitate the performance of their respective functions regarding supervised entities.
• 22 February 2024 - Multilateral Memorandum of Cooperation (MMC) sponsored by the European Central Bank to foster cooperation on non-EU banks. The Bank of Italy has signed the Multilateral Memorandum of Cooperation (MMC) between the European Central Bank and the National Competent Authorities of the Member States participating in the Single Supervisory Mechanism. Specifically, it aims to make the new supervisory cooperation requirements operative, envisaged under the Capital Requirements Directive, among the competent authorities supervising credit institutions branches with a head office in a third country and the competent authorities of institutions that are part of the same third-country group.

Relevant issues