DNB welcomes Netherlands Court of Audit report on banking supervision

Press release
Date 27 September 2017

De Nederlandsche Bank (DNB) welcomes the Netherlands Court of Audit (ARK) report of its audit of DNB's supervision of small and medium-sized banks in the Netherlands, "Supervision of banks in the Netherlands", which was published today.

The Court of Audit found that DNB's supervision approach is well-designed and that its implementation is comprehensive and decisive. The Court issued a number of useful recommendations for further strengthening DNB’s internal operational processes and updating the existing agreements on information sharing and cooperation with the Ministry of Finance. Furthermore, DNB could take steps to provide more clarity about the capital and liquidity requirements it imposes on small and medium-sized banks.


The audit covered DNB's supervision of small and medium-sized banks, i.e. the less significant banks under its direct supervision. The supervision of large banks is the direct responsibility of the European Central Bank, which plays a coordinating role in the European Single Supervisory Mechanism.

In accordance with its mandate and the applicable laws and regulations, the Court of Audit was allowed access to confidential information in order to gain a thorough understanding of DNB's working procedures. It assessed DNB's internal operational processes and interviewed various staff members from DNB and institutions under its supervision.

Comprehensive supervision

In its response to the findings, which was included as an annex to the report, DNB stated that the Netherlands – especially in an international context – has a substantial financial sector comprising important small and medium-sized institutions. Comprehensive supervision is therefore essential to safeguard financial stability. In its supervision, DNB takes the nature and size of institutions into account. DNB tailors the capital and liquidity requirements it imposes on banks to the specific risk profiles ensuing from their activities.

The introduction of the SSM in 2014 marked an important step towards further harmonisation of regulations and supervision in Europe. Now that the transitional period is coming to a close, operational processes are solidifying. In accordance with the Court of Audit's recommendations, DNB will focus on strengthening and documenting these processes, providing more clarity to supervised institutions and explaining how capital and liquidity requirements are determined.

Close cooperation with the Ministry of Finance

With regard to cooperation with the Ministry of Finance, DNB stated that it is an independent public body, which puts the implementation of supervision on an intentional distance. This is a basic element of the supervisory model, in line with internationally recognised standards and essential for effective and independent supervision. To ensure effective supervision, clear agreements were made about regular consultations, close cooperation and frequent information exchange. These agreements are functioning well and will be updated to reflect the introduction of the SSM and DNB's responsibility as the national resolution authority.

Monitoring and accountability

The introduction of the SMM may have an impact on the Court of Audit's existing agreements and mandate to access information. DNB attaches great importance to accountability of its supervision and will make efforts to facilitate future audits by the Netherlands Court of Audit or its European counterpart.


End of press release

For more information, please contact Tobias Oudejans by telephone at +31 20 524 3100 or +31 6 524 96 961.