Since the introduction of the new Banking Act, various governance rules have been updated and further detailed. The National Bank of Belgium published on 7 December 2015 a circular that introduces a governance manual for the banking sector. This manual aims to combine and clarify all governance policy documents applicable to credit institutions.
The financial crisis drew more attention to the need for appropriate corporate governance in financial institutions. International and national initiatives were taken regarding corporate governance. The Banking Act, introduced in 2014, updated and further detailed the existing governance rules. The new governance manual (the Manual) will replace, with immediate effect and with regard to credit institutions, the CBFA circular of 30 March 2007 on the CBFA’s prudential expectations on financial institutions’ sound governance.
The Manual aims to combine and clarify all documents that apply to credit institutions in the area of governance. It also entails clarifications regarding topics that are, as such, not covered by specific governance policy documents. Needless to say, the Manual does not affect the governance powers of other supervisory authorities (e.g. the FSMA).
Topics covered by the Manual are (i) suitability of shareholders or partners, (ii) suitability of management and of independent control functions, (iii) appropriate organisation of the business, (iv) public disclosure and transparency and (v) group context.
However, the Manual does not replace the underlying policy documents. If those were to change, the manual would also be changed. It should also be noted that, for the purposes of the Manual, the Single Supervisory Mechanism (SSM) should be taken into account. In this context, “supervisory authority” should be understood to mean the European Central Bank (ECB) or the National Bank of Belgium (NBB), depending on the circumstances. Although the ECB is competent for “important” credit institutions within the meaning of the SSM Regulation, it is the task of the national competent authorities to assist the ECB in its supervisory activities. The NBB offers this assistance in the context of the “Joint Supervisory Teams”, which are the institutions’ first point of contact.
The Manual is available for online consultation (see www.nbb.be/governancebanks) and includes interactive references.
This article was co-written by Marleen Mouton, Geassocieerd advocaat/Avocat associé, Lawsquare, and Olivier Hermand, Partner, PwC.
 The Act of 25 April 2014 on the statute and the supervision of credit institutions.