The European Central Bank is taking aim at Finland’s plan to require supervisors to promote growth and competition among lenders, warning that the change risks blurring their core responsibility for keeping banks safe and sound.

With the EU’s long-promised revamp of banking regulation still months from being finalized and likely years from implementation, Finland is seeking to become the first eurozone country to introduce a formal competitiveness mandate for its supervisors.

But the ECB is pushing back. President Christine Lagarde warned Finland in an August letter that the proposal could create conflicting objectives for supervisors and said there was no need for such a mandate. The issue remains live as Helsinki works on the legislation, according to a person people familiar with the matter who spoke on condition of anonymity.

The clash goes to a broader debate over how far Europe should bend financial regulation to boost sluggish growth and competitiveness without weakening safeguards put in place after the financial crisis. The Finnish proposal is linked to Prime Minister Petteri Orpo’s government program, which calls for safeguarding the stability and competitiveness of financial markets while ensuring regulation doesn’t unduly increase the cost or restrict the availability of credit.

Although Finland’s plan echoes changes to the job description of the Bank of England’s regulatory arm and the Financial Conduct Authority in 2023, the issue remains contentious in the 27-nation EU, where officials have so far resisted similar mandates in growth-boosting initiatives.

In Finland, the proposed mandate would apply only to the Financial Supervisory Authority, or FIN-FSA, which oversees banks day to day. The ECB takes the lead in supervising Finland’s four biggest lenders, including OP Financial Group and Nordea, while FIN-FSA handles dozens of smaller banks under ECB oversight. The Bank of Finland — the country’s central bank — wouldn’t be given the new mandate.

In the August letter, the ECB said it remained concerned even after Helsinki clarified that the competitiveness mandate could only be pursued where it didn’t conflict with the supervisor’s primary objective.

Lagarde warned that the new duty could still create conflicting objectives and force FIN-FSA to show it had weighed competitiveness every time it changed a macroprudential measure. That, she said, could create “inaction bias,” with supervisors hesitating to act against systemic risks for fear of being blamed for holding back growth.

The plan also triggered concern at home. One worry is that under the proposed regime, banks could challenge capital buffers set for the industry by arguing they hurt competitiveness.

Marja Nykänen, a Bank of Finland board member, told Bloomberg that the existing framework already supports growth by reducing the risk of financial crises and questioned why Finland needed a mandate that she said had no close European precedent outside the UK.

However Economic Affairs Minister Sakari Puisto said the government had taken the ECB’s concerns into account and was seeking a balanced formulation. He said in an emailed response to questions that the provision wouldn’t apply to individual supervisory matters involving regulated firms or to licensing.