“The model of integrated supervision, with all areas of the Austrian financial market supervised under one roof, has proven itself,” declared FMA Executive Directors Helmut Ettl and Klaus Kumpfmüller in summarising the last decade of supervisory activities during the presentation of the FMA’s Annual Report 2015. With 368 inspections in 2015, there was an increase of 449% in the number of on-site inspections in comparison with 2006. The number of administrative penal proceedings has doubled during the same period to 181, with the number being reported to the Public Prosecutor’s Office increasing almost sixfold to 98. “Our consistent supervisory activity is not, however, an end in itself, but has allowed us to strengthen the stability of the Austrian financial market and increase consumer protection”, remarked Ettl and Kumpfmüller. The FMA’s Executive Board cited the example of the Tier 1 capital ratio of the banks – the most important risk buffer, which has increased from around 8% in 2008 to almost 13%, while the solvency ratio, the most important figure of the ability of insurers’ to cover their obligations, has risen from 325% to 375% over the same period.
Effective and efficient supervision with an expanding portfolio of tasks
“We are particularly proud of the fact that such a massive intensification of supervisory activities has been achieved while also consistently keeping costs firmly in check” the FMA’s Executive Board declared. Additionally the Executive Board highlighted that the legislator has continually conferred new tasks upon the FMA over the last few years, citing the supervision of financial conglomerates, prospectus supervision, the prevention of money laundering, the supervision of hedge funds, the function as resolution authority and combatting of unauthorised business, as just a few examples. The Europeanisation of supervision, which finally ensures the cross-border supervision of the internationalised financial sector, is very intensive in terms of work as well as being a very large challenge. Whereas the legal acts relating to the FMA’s supervisory remit ran to 660 pages in 2006, these texts have increased almost sevenfold in length in the intervening period to 4 478 pages. “We also view the a conferring of new tasks as confirmation of the trust that the legislator places in our work and in the successful integrated supervision model”, Ettl and Kumpfmüller reiterated.
Creditable results for 2015
In 2015 the FMA, with 374 employees and a financial budget of EUR 61.3 million, supervised a total of 973 licenced companies, with total assets under management of EUR 1 293 billion, as well as supervising almost 34 million transactions in listed securities over the course of the year. The licenced companies employ around 116 000 employees in Austria alone and generate EUR 15.1 billion in value added per year. The total assets of the Austrian banks including their foreign subsidiaries are equivalent to more than 300% of Austria’s Gross Domestic Product.
The supervised entities pay approximately 88% of the FMA’s costs, while the Federal Government makes a lump sum contribution of EUR 3.5 million. EUR 4 million comes from fees and other income. The FMA collects EUR 8 million for services rendered by the Oesterreichische Nationalbank (OeNB). The banks contribute EUR 29.0 million (54%), while insurance undertakings contribute EUR 10.8 million (20%), the Pensionskassen EUR 1.1 million (2%) and the area of securities supervision EUR 12.9 million (24%).
The successful integrated supervision model
“The integrated supervision model has proven its effectiveness for the small but nevertheless internationally systemically important Austrian financial market. As a prudential supervisory authority, the FMA ensures that supervised institutions are both stable and crisis-resistant. With regard to conduct supervision, the FMA ensures that institutions treat their customers and investors fairly. As an integrated supervisory authority, the FMA ensures that fair and consistent rules extend beyond the boundaries between products and sectors. As a supervisory authority both on a micro and macro level, the FMA ensures that the findings and measures deployed on the level of individual institutions are also linked to one another on an aggregated level,” Ettl and Kumpfmüller concluded
Journalists may address further enquiries to:
Klaus Grubelnik (FMA Media Spokesperson)
+43/(0)1/24959-6006
+43/(0)676/882 49 516