Wolf, G., (2013), “Europe rightly pursues the road to a single resolution mechanism”, Bruegel, 27 Νοεμβρίου.
European leaders continue to negotiate the most desirable structure of a single resolution mechanism. Making significant progress on that front is of central importance, as we have argued in a recent piece to the informal ECOFIN. The single most important reason why it is important relates to the reshaping of Europe’s financial system.
Since the onset of the crisis, much of the pre-crisis financial integration was undone. This led to serious divergence of financing conditions, combined with a grave slump in economic activity in the countries most affected by prohibitive financing conditions.
The decision to move ahead with a banking union together with the ECB’ OMT programme have since greatly stabilised the situation, and funding has been coming back to a number of euro area countries.
The ideal next step forward would be to create a strong centralised resolution authority with a common fiscal backstop. Yet, this solution is proving to be difficult to achieve in a short enough time span to be operational next year, when the ECB’s asset quality review will likely trigger a number of important decisions on bank recapitalisation, resolution, as well as bank mergers.
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Σχετικές Αναρτήσεις
- Dell’ Ariccia, G., Goyal, R., Koeva-Brooks, P. and Tressel, T., (2013) “A banking union for the Eurozone”, VoxeEU, 5 Απριλίου.
- Mody, A., (2013), “A Schuman compact for the euro area”, Bruegel, Bruegel Essay and Lecture Series, Νοέμβριος.
- Beck, T. and Trebesch, C., (2013), “A bank restructuring agency for the Eurozone – cleaning up the legacy losses”, VoxEU, 18 Νοεμβρίου.