What is the ESCB?

The European System of Central Banks is a group composed of:

  • the European Central Bank (ECB), and
  • the national central banks (NCBs) of all the Member States of the European Union.

Compared to the Eurosystem, the ESCB also includes the NCBs of the Member States of the European Union which have still not adopted the euro, either because of their ‘special’ status (Denmark) or because they still have not fulfilled all of the convergence criteria. These countries continue to use their national currencies and have their own monetary policy. Their central banks have to this date retained their monetary sovereignty.

Nevertheless, ESCB membership implies, at different levels, an active cooperation with the Eurosystem in several domains of activity, such as for example the contribution to the collection of statistics or the participation in the TARGET2 payment system. The European exchange rate Mechanism (ERM II) offers an area of cooperation with the Eurosystem on the level of monetary and exchange rate policy. The governors of the central banks of the ESCB meet four times a year at the ECB, within the General Council.