European Central Bank Vice President Vitor Constancio is in the race to become the head of a new euro zone bank regulator, German daily Handelsblatt said, citing European Commission sources.
Constancio has emerged as a possible candidate in talks, Handelsblatt said in an advance copy of its Tuesday edition.
An ECB spokeswoman declined to comment.
If Constancio were to take on the regulatory role, he would need to step back from some of his existing responsibilities at the ECB to avoid a conflict of interest between monetary policy and bank supervision, Handelsblatt said.
The bank supervisor would have its own board of directors separate from the ECB executive board, the newspaper said.
The European Commission is due to make proposals on what European-wide banking supervision could look like on Wednesday. It has made clear it wants the ECB to oversee all 6,000 banking institutions.
European Union leaders agreed at the end of June to set up a single banking supervisor in Europe and aimed to have it in place by the end of the year.
Such broad oversight would be the first step toward creating a banking union and allowing the euro zone to directly recapitalize banks to break the vicious circle between indebted governments and their troubled financial sectors.
(Reporting by Edward Taylor and Eva Kuehnen; Editing by Leslie Adler)