ECB Staff “Deeply Unsettled” by Simplification Push

In a recent article, Bloomberg reports that some staff within the European Central Bank (ECB) are pushing back against leadership rhetoric that they fear could undermine the post-Crisis supervisory regime.

In a letter sent to Claudia Buch, Chair of the ECB’s Supervisory Board, the ECB staff committee said recent remarks by Santa Purgaile, a Member of the Supervisory Board and Deputy Governor of Latvia’s central bank, left some colleagues “deeply unsettled,” according to the document seen by Bloomberg. The flashpoint was an interview Purgaile gave in December, in which she argued that “changing people” may be necessary for supervision to evolve, and suggested that the conservatism introduced through post-Crisis reforms was a “psychological thing we need to address.”

The letter described those comments as “worrying on multiple fronts,” and warned that such statements suggest that “the efforts made over the past years to implement the learnings from the previous crisis are now being questioned, with a view to having them reverted.” The letter also flagged concerns about national influence in day-to-day supervision, and said the remarks were concerning both from “the perspective of diversity of thoughts as well as job security.”

Bloomberg notes that the current concerns echo a 2024 episode involving Frank Elderson, an ECB Executive Board member, who drew staff criticism after questioning why the ECB would hire people “whom we have to reprogram” regarding climate risks. In their letter to Buch, staff wrote that they appreciated the apologies offered at the time, “though it seems this ‘mindset’ has not changed at all.”