The European Central Bank said on Friday it will take over supervision of the European operations of Barclays and Bank of America Merrill Lynch (BofAML) after they moved some businesses to Ireland from Britain because of Brexit.

The two banks' Irish subsidiaries have previously been supervised by Irish authorities but their bigger size means they will now come under the ECB's watch.

Bank of America announced this month that it had merged its UK banking entity into its Irish unit, employing over 800 people in Dublin and making the company its principal European banking entity.

Barclays has also made Dublin the headquarters of its European operations, employing around 400 in the Irish capital and beefing up the unit's balance sheet to about 250 billion euros, the Irish government has said.

The ECB supervises euro zone-based banks when total assets exceed 30 billion euros or if they are deemed locally significant, among other criteria. Barclays and Bank of America's remaining operations in the UK will continue to be supervised by British authorities.

The ECB has long insisted that banks seeking to do business in the European Union after Brexit must move actual operations, including assets and qualified personnel, as it would not grant licenses to 'empty shell' or letter box banks.

Over two dozen UK-based banks are in various stages of obtaining an EU license from the ECB to maintain their access to the bloc once Britain leaves but few have made an actual move.

The ECB, which looks over 119 of the euro zone's biggest lenders, also said it would no longer supervise Dublin-based Permanent tsb Group Holdings plc as the bank did not meet any of the significance criteria for three consecutive calendar years. (Reuters)

Source: www.businessworld.ie