Begg, I. (2014) “What has been agreed on banking union risks reigniting, rather than resolving the crisis“, LSE, Euro Crisis in the Press, 02 April.
In December 2013 EU finance ministers negotiated an agreement aimed at establishing a banking union, with further talks between the European Parliament and the Member States ending in an agreement last week. Iain Begg provides a detailed overview of the main objectives of banking union and what has been agreed so far. He argues that while European leaders have probably gone as far as they can over reaching a compromise, the measures agreed are still insufficient and could potentially exacerbate the risk of another Cyprus-style crisis taking place within the Eurozone.
Among the many economic governance initiatives undertaken over the last few years, those intended to achieve deeper financial integration have been widely regarded as crucial and urgent. The financial crisis and the subsequent sovereign debt crisis had revealed a number of flaws in the governance of the euro, and the EU’s leaders have since tried hard to put in place a new framework for economic policy-making which deals with these flaws. However, progress has been slow and has exposed deep differences among the Member States.
- Veron, N. (2014) “Tectonic shifts – banking union is a long-term process that will dramatically reshape Europe’s financial system”, Bruegel, 7 March.
- Greene, M. (2014) “The Eurozone’s Imperfect Banking Union”, Open Markets, 20 February.
- Valante, D. (2014) “Framing Banking Union in the Euro Area: Some empirical evidence”, CEPS Working Document, N. 389/February 2014.