Banking Union
Banking Union
Context
In response to the sovereign crisis, the EU created the Banking Union in 2012 to safeguard financial stability, deliver a safer banking sector and protect the taxpayer from the cost of bank failures. The Banking Union, currently covering the 19 Eurozone countries, is also open to other EU Member States and is based on three pillars.
The first pillar is the Single Supervisory mechanism (SSM), a new system of banking supervision comprising the ECB and the national authorities, directly supervising the 115 most significant banks of the euro area (holding almost 82% of assets). The second pillar is the Single Resolution Mechanism (SRM) in charge of the resolution of failing banks with minimal costs for taxpayers and to the real economy.
The funds used for resolution are provided by the Single Resolution Fund (SRF), financed by contributions from banks and guaranteed as a last resort by a Common Backstop provided by the ESM, following an agreement reached by the Member States. In case it is used the common backstop would be repaid by the banking sector. A single rulebook applies to these two first pillars.
The third pillar is the European deposit insurance scheme (EDIS) for bank deposits in the euro area proposed by the Commission in November 2015. Building on the system of national deposit guarantee schemes (DGS), this system already ensures that all deposits up to €100 000 are protected by DGSs all over the EU. Ultimately, these national DGSs are to be fully financed by EDIS
Contributions to the policy debate
Extracted from the main Eurofi publications (Regulatory Updates, Views Magazines and Conference Summaries)
Key Eurofi
documents
Eurofi policy notes
The protection of deposits in the EU : Pros and Cons and a possible way forward - April 2020
Making the Banking Union effective : what priorities ? - September 2019
Medium sized bank resolution : challenges and tools - September 2019
Banking fragmentation issues in the EU - September 2019
Addressing ring-fencing issues in the Banking Union - April 2019
Session summaries
Making the Banking Union effective - Helsinki Financial Forum - September 2019
Medium-sized bank resolution - Helsinki Financial Forum - September 2019
Addressing ring-fencing issues in the Banking Union - Bucharest High Level Seminar - April 2019
Optimising the Banking Union - Vienna Financial Forum - September 2018
Resolution of banking groups at the EU Level - Vienna Financial Forum - September 2018
Public and private
sector views
Public authority views
Banking Union
M. Ferber - European Parliament - A Banking Union for a stronger Europe - April 2020
I. Tinagli - European Parliament - The cost of not achieving the Banking Union - April 2020
Resolution framework
E. Fernandez-Bollo - European Central Bank (ECB) - Banking Union beyond home and host - April 2020
EDIS
P. Hernández de Cos - Banco de España - Common policies against common shocks - April 2020
J. Fernández - European Parliament - EDIS: completing the Banking Union - April 2020
Industry views
Bank resolution
Dr. A. Dombret - Oliver Wyman - Much still needs be done! - April 2020
M. Stolpe - Nordea - Trust in the Single Market - April 2020
M. Venus - BNP Paribas - Liquidity in Resolution: the case for constructive certainty - April 2020
EDIS
G. Huber - DSGV - Banking Union already established - April 2020