Economics of the European Union
A Roadmap towards Banking Union - Summary
Communication from the Commission to the European Parliament and the Council - A
Roadmap towards a Banking Union - 2012
1. Introduction
→ Following the Eurozone crisis, the EU wants to make nancial institutions and markets
more stable, more competitive and more resilient.
→ This can be achieved thanks to a reform of the EU regulatory framework, but also,
and mainly, thanks to the implementation of a banking union. This banking union will help
tackle cross-border spill-over e ects in the event of bank crisis, and will break the link
between sovereign debt and bank debt.
The supervision of banks is shifted to the European level.
→ This banking union will restore con dence in the Euro as part of a longer term vision for
economic and scal integration and will help build the necessary trust between the Member
States.
This communication accompanies two legislative proposals:
1. Setting up of a single supervisory mechanism by conferring speci c tasks on the ECB
concerning policies relating to the prudential supervision of credit institutions
2. Adaptions to the Regulation setting up the European Banking Authority (EBA).
→ Resulting in qualitative improvement in nancial stability and con dence in the Euro area
2. The Banking Union (BU) and the Single Market
Single market for nancial services → banks and other nancial institutions which enjoy
rights of free establishment and free provision and services are subject to equivalent rules
and proper supervision across the EU.
→ The creation of the BU must not compromise the unity and integrity of this Single
market.
The Single Market and the BU are mutually reinforcing processes, and the work to
strengthen the SM must continue and be accelerated, especially in three areas of speci c
relevance to the BU:
1
fi fi ff fi fi fi fifi fi
A Roadmap towards Banking Union - Summary
Communication from the Commission to the European Parliament and the Council - A
Roadmap towards a Banking Union - 2012
1. Introduction
→ Following the Eurozone crisis, the EU wants to make nancial institutions and markets
more stable, more competitive and more resilient.
→ This can be achieved thanks to a reform of the EU regulatory framework, but also,
and mainly, thanks to the implementation of a banking union. This banking union will help
tackle cross-border spill-over e ects in the event of bank crisis, and will break the link
between sovereign debt and bank debt.
The supervision of banks is shifted to the European level.
→ This banking union will restore con dence in the Euro as part of a longer term vision for
economic and scal integration and will help build the necessary trust between the Member
States.
This communication accompanies two legislative proposals:
1. Setting up of a single supervisory mechanism by conferring speci c tasks on the ECB
concerning policies relating to the prudential supervision of credit institutions
2. Adaptions to the Regulation setting up the European Banking Authority (EBA).
→ Resulting in qualitative improvement in nancial stability and con dence in the Euro area
2. The Banking Union (BU) and the Single Market
Single market for nancial services → banks and other nancial institutions which enjoy
rights of free establishment and free provision and services are subject to equivalent rules
and proper supervision across the EU.
→ The creation of the BU must not compromise the unity and integrity of this Single
market.
The Single Market and the BU are mutually reinforcing processes, and the work to
strengthen the SM must continue and be accelerated, especially in three areas of speci c
relevance to the BU:
1
fi fi ff fi fi fi fifi fi
