The euro is managed and administered by the Frankfurt-based European Central Bank (ECB) and the Eurosystem (composed of the central banks of the eurozone countries).
It is a task of the Eurosystem to ensure an efficient and smooth supply of euro notes and to maintain their integrity throughout the euro area.
Afterward, the European Central Bank — or strictly speaking, the so-called Eurosystem network of euro zone central banks — was stuck with the assets.
That is, without a change in policy, we can expect the consolidated balance sheet of the Eurosystem to fall to roughly €1.8 trillion.
It is the largest member of the so-called Eurosystem, the network of 17 national central banks overseen by the central bank.
The Bundesbank is the largest bank in the Eurosystem, the network of central banks in the euro zone.
The analogy between the Fed and the ESCB is also helpful to cast some light on potential developments within the "Eurosystem". For instance, the influential role played by the Federal Reserve Bank of New York (FRBNY) within the Federal Reserve System is an interesting "precedent" that suggests the possibility of one (or a few) of the NCBs playing a predominant role within the ESCB in future.
Without that, without a truly pan-European financial system that is mutually and jointly guaranteed by all of the countries of the Eurosystem, we doubt that the common currency can survive.
But the ECB is owned by the 17 euro-area NCBs, and the combined capital of the Eurosystem was worth over €80 billion at the start of June.On the face of it, then, the ECB should be able to withstand losses arising from a default, even if it needed further recapitalisation by its NCBs.
Yannis Stournaras, the governor of the Bank of Greece and a member of the ECB council, said: "The Bank of Greece, as a member of the Eurosystem, will take all measures necessary to ensure financial stability for Greek citizens in these difficult circumstances".
