The two most important objectives of central banks in the world are the stability of prices and overall financial stability. The statutory responsibility of the European Central Bank has been confined to the implementation of the monetary objective. That is why the paper enquires whether the ECB has also been endowed with appropriate competence and instruments to effectively support financial stability in the euro area.

As far as the financial stability is concerned, the statutory mandate of the ECB does not exceed beyond activities aimed at supporting efficiency and security of the payment system. In practice, however, the ECB has at its disposal a number of instruments that may be effectively used to support the stability of the financial system. These include the complex operational system, where fine tuning operations play a particular role. Information policy of the ECB is also of great significance. It constitutes an important instrument of the central bank, which exerts a steadily growing influence on the stability of the financial system, both in the context of normally operating markets, as well as under conditions of potential threats to the financial system stability.

It is worth emphasizing that a number of tasks intended to support the stability of the financial system are implemented in the Eurosystem in a decentralised way - at the national level. Among them is, i.a. the banking supervision.

Doubts or even criticism arise around the Eurosystem ability to meet challenges that may follow on a financial crisis in the euro area. Decentralised supervision over the banking system, and the fact that in a number of the Eurosystem Member States supervision is carried out by institutions that are independent from the Central Bank result in a situation where the ECB has a limited access to information of supervisory character. This above is of utmost importance in terms of crisis management in a banking system.

Moreover, due to the centralisation of the ECB decisions on the supply of liquidity to the banking system of the euro area, the scope of competence in the performance of the function of the lender of last resort has not been explicitly defined. The Eurosystem lacks in explicit information on the principles of dividing competence, responsibility and potential costs of crisis management between the ECB and NCBs in the Eurosystem.