The three fledgling regulators overseeing the European Union’s financial sector can take a number of short-term and longer-term steps to bolster their clout within the bloc, according to a review of the supervisory agencies released by the European Commission last week.

The review was the first since the three watchdogs – the European Banking Authority (EBA), the European Securities and Markets Authority (ESMA), and the European Insurance and Occupational Pensions Authority (EIOPA) -- were established in 2011. Together the three comprise the European Supervisory Authorities (ESAs), designed to tighten financial supervision in the EU, plug holes exposed by the 2008 financial collapse, and ensure consistent application of EU rules by national regulators.

Overall, the review found that the ESAs have done well in the past three years to get up and running, start delivering on their mandates, and aid in the functioning of a single market through uniform rules throughout the 28 Member States. But the review also identified several ways for the agencies to be more effective, including expanding into new areas of supervision and exercising existing powers better.

“This review is aimed at further enhancing the ability of the ESAs to improve the functioning of the single market for financial services and thus identifies scope for action in the short and medium term,” European Commission Vice President for Internal Markets and Services Michel Barnier said in a brief statement.

The European Commission is considering expanding the mandate into new areas, including consumer protection, enforcement of International Financial Reporting Standards (IFRS), stronger oversight on internal model validation for the insurance sector, and shadow banking. Currently consumer protection is mainly handled at the national level, but the report pointed out that some jurisdictions do not have nationwide mandates and lack expertise in that area.

Member States also should expect to see more peer reviews from the agencies once they are more established. Those reviews will consist of thematic peer reviews as well as country-specific reviews with better follow-up, which should aid the goal of supervisory convergence, the report said.

Stakeholder concerns addressed in the review showed a need for more transparency in the ESAs’ regulatory process, including the timeframe for public consultations and the level of feedback provided. The funding model for the authorities also will be addressed. Now the agencies receive 40 percent of their budgets from the EU budget and the rest from Member States. The report suggests a switch to different funding models, such as fees or levies.

Longer term objectives include a review of the agencies’ binding mediation powers, now unused, with a look at the scope of those powers and triggers for them. The commission also will investigate whether the ESAs should be able to access data directly from national regulators or financial institutions. Additionally, the commission will look into improving governance of the ESAs to ensure swift decisions “are taken in the interest of the EU as a whole,” rather than for individual jurisdictions, the report said.

An article in Reuters suggested any attempts to strengthen the ESAs’ powers could cause friction with the United Kingdom. The U.K. already is attempting to claw back powers from Brussels, and a referendum on the so-called “Brexit” is possible in 2017 for the U.K. to decide whether to remain in the EU.

A separate review of the European Systemic Risk Board (ESRB), which is tasked with macro-prudential oversight in the EU, came up with similar findings – praise for how quickly the board developed along with short- and medium-term recommendations. The review advocates improvements to the board’s framework to boost the efficiency of macro-prudential oversight of the bloc, and “expansion of the ESRB’s toolbox” to include more soft powers for added flexibility and early intervention. Shorter term goals are more proactive communication and a broader focus beyond banking risks.