The Financial Supervision Authority

The Estonian Financial Supervision and Resolution Authority (Finantsinspektsioon) is an independent public institution that is responsible for regulating the financial market, that became operational on 1 January 2002, due to the enactment of the Financial Supervision Authority Act which stated its main purposes, functions, funding, and international commitments.

Principles of Supervision

The Finantsinspektsioon always supervise all types of the financial market participants, such as  banks, insurance companies and brokers, investment firms, pension funds, fund managers, payment (including e-money) institutions, creditors and loan intermediaries, crowdfunding platforms, debt collection companies, securities markets, as well as crypto-asset markets.

Theoretical Aspects of Supervision

Functioning as a supervisor, Finantsinspektsioon has a supervisory authority similar to the European Union model.

For banking supervision, larger organizations (LHV, SEB, Swedbank and Luminor) are subject to joint supervision in cooperation with the European Central Bank as part of the Single Supervisory Mechanism (SSM).

Operational Functions

According to article 22(2) and following of the Financial Supervision Authority Act, Finantsinspektsioon’s main operations include

Granting of financial institutions' licenses: Measures assessed are determined by the underlined conditions , such minimum requirements for initial capital for banks as in a EU law.

Assessment of Corporate Governance: Each supervised financial institution, and their designed service providers should have effective corporate governments' structures in place to ensure transparency, accountability, and compliance.

Oversight of Risk Management: Finantsinspektsioon will assess how the supervised institutions identify, measure and reduce their financial risks.

Solvency Related Supervision: Financial institutions are required to meet their obligations to depositors, policyholders and pension savers through appropriate solvency provisions.