According to the International Monetary Fund, Clearstream Banking Luxembourg’s substantial role in the financial system might justify a shift to European Central Bank direct supervision, although it is currently overseen by Luxembourg’s Financial Sector Supervisory Commission (CSSF) as a less significant institution. This suggestion was part of the “technical note on selected issues in banking supervision.” The IMF that Clearstream Banking Luxembourg (CBL), an international central securities depository, could potentially fall under the direct supervision of the ECB. The IMF report highlighted that while CBL is currently classified by the single supervisory mechanism (SSM) as a Less Significant Institution (LSI), its global systemic importance and operational complexity might warrant a shift in its supervisory status.

According to the IMF report, which was issue on 24 June 2024, “CBL’s global systemically important interconnectedness and substitutability characteristics, as well as its structural and operational complexity, may justify an ECB decision” to directly supervise the bank. . This could occur either on the ECB's own initiative or at the request of the Luxembourg financial regulator, the CSSF.

In response to the IMF’s suggestion, a representative from the CSSF told Delano that the issue of CBL’s supervisory status is not new and dates back to the inception of the SSM. The CSSF representative explained that CBL was included in the ECB’s comprehensive assessment, which serves as a precursor to potential direct ECB supervision. Despite CBL’s significant role in financial markets, the representative noted that specialised institutions like CBL are subject to limited powers under the SSM regulation. The representative stated, “So, while CBL is an institution of significant relevance for financial markets, there are arguments to keep it under the LSI framework.” The CSSF also clarified that “the status of entities like CBL is periodically (no mechanistic timeframe) reassessed at SSM level.”

Nonetheless, the CSSF holds the view that while CBL is indeed systemically relevant, and in its opinion, “the systemic relevance of CBL rather places it on the side of SIs and hence under direct ECB supervision.”

A spokesperson from Clearstream Banking commented to Delano that “Clearstream regards the choice of its supervisory set-up as a matter for relevant authorities.” Clearstream Banking Luxembourg is already under supervisory purview as an other systemically significant institution (O-SSI) and as a central securities depository in accordance with the EU’s CSD regulation.