IDEAS home Printed from https://ideas.repec.org/a/psl/pslqrr/201622.html
   My bibliography  Save this article

The process towards centralisation of the European financial supervisory architecture: The case of the Banking Union

Author

Listed:
  • Elisabetta Montanaro

    (Department of Business and Law, University of Siena)

Abstract

The evolution of the EU supervisory architecture has demonstrated that it took the risk of a euro break-up to just barely overcome the political resistances to centralisation by Member States and their supervisors. In the two-tier Europe that is emerging after the euro crisis, the integrity of the single market seems today crucially interlinked with the success of the banking union and its attractiveness for non-euro countries. The banking union’s design, without a credible common fiscal backstop, remains however a partial solution to the financial stability issues arising from the fragmentation of the EU financial market in the event of banking crises. The analysis performed on non-euro countries’ assessments of the pros and cons of joining the banking union aims to show that until fiscal responsibility for financial stability remains at the national level, regulatory centralisation cannot sever the traditional divide between home and host supervisors.

Suggested Citation

  • Elisabetta Montanaro, 2016. "The process towards centralisation of the European financial supervisory architecture: The case of the Banking Union," PSL Quarterly Review, Economia civile, vol. 69(277), pages 135-172.
    • Handle: RePEc:psl:pslqrr:2016:22
    as

    Download full text from publisher

    File URL: http://ojs.uniroma1.it/index.php/PSLQuarterlyReview/article/view/13696/13481
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Pinar Yesin, 2013. "Foreign currency loans and systemic risk in Europe," Review, Federal Reserve Bank of St. Louis, vol. 95(May), pages 219-236.
    2. Valiante, Diego, 2014. "Framing Banking Union in the Euro Area: Some empirical evidence," CEPS Papers 8882, Centre for European Policy Studies.
    3. Tommaso Padoa‐Schioppa, 1999. "EMU and Banking Supervision," International Finance, Wiley Blackwell, vol. 2(2), pages 295-308, July.
    4. Robert A. Eisenbeis, 2004. "Agency problems and goal conflicts," FRB Atlanta Working Paper 2004-24, Federal Reserve Bank of Atlanta.
    5. Mr. Robert Marquez & Mr. Giovanni Dell'Ariccia, 2001. "Competition Among Regulators," IMF Working Papers 2001/073, International Monetary Fund.
    6. Dewatripont, Mathias, 2014. "European banking: Bailout, bail-in and state aid control," International Journal of Industrial Organization, Elsevier, vol. 34(C), pages 37-43.
    7. Dirk Schoenmaker & Sander Oosterloo, 2005. "Financial Supervision in an Integrating Europe: Measuring Cross‐Border Externalities," International Finance, Wiley Blackwell, vol. 8(1), pages 1-27, March.
    8. Tröger, Tobias H., 2013. "The single supervisory mechanism - Panacea of quack banking regulation? Preliminary assessment of the evolving regime for the prudential supervision of banks with ECB involvement," SAFE Working Paper Series 27, Leibniz Institute for Financial Research SAFE.
    9. Zsolt Darvas & Guntram B. Wolff, 2013. "Should Non-Euro Area Countries Join the Single Supervisory Mechanism?," DANUBE: Law and Economics Review, European Association Comenius - EACO, issue 2, pages 141-163, June.
    10. Ms. María Nieto & Mr. Garry J. Schinasi, 2007. "EU Framework for Safeguarding Financial Stability: Towards an Analytical Benchmark for Assessing its Effectiveness," IMF Working Papers 2007/260, International Monetary Fund.
    11. Kahn, Charles M. & Santos, Joao A.C., 2005. "Allocating bank regulatory powers: Lender of last resort, deposit insurance and supervision," European Economic Review, Elsevier, vol. 49(8), pages 2107-2136, November.
    12. Prati, A. & Schinasi, G.J., 1999. "Financial Stability in European Economic and Monetary Union," Princeton Studies in International Economics 86, International Economics Section, Departement of Economics Princeton University,.
    13. Avinash D. Persaud, 2015. "Reinventing Financial Regulation," Springer Books, Springer, number 978-1-4302-4558-2, November.
    14. Holthausen, Cornelia & Rønde, Thomas, 2004. "Cooperation in international banking supervision," Working Paper Series 316, European Central Bank.
    15. Lastra, Rosa Maria, 2006. "Legal Foundations of International Monetary Stability," OUP Catalogue, Oxford University Press, number 9780199269341, Decembrie.
    16. Hadjiemmanuil, Christos, 2015. "Bank resolution financing in the banking union," LSE Research Online Documents on Economics 61588, London School of Economics and Political Science, LSE Library.
    17. Giorgio Di Giorgio & Carmine Di Noia, 2001. "Financial Regulation and Supervision in the Euro Area: A Four-Peak Proposal," Center for Financial Institutions Working Papers 01-02, Wharton School Center for Financial Institutions, University of Pennsylvania.
    18. Dell'Ariccia, Giovanni & Marquez, Robert, 2006. "Competition among regulators and credit market integration," Journal of Financial Economics, Elsevier, vol. 79(2), pages 401-430, February.
    19. Elisabetta Montanaro & Mario Tonveronachi, 2011. "A critical assessment of the European approach to financial reforms," PSL Quarterly Review, Economia civile, vol. 64(258), pages 193-226.
    20. Dirk Schoenmaker, 2015. "Firmer foundations for a stronger European Banking Union," Working Papers 10704, Bruegel.
    21. Mr. Fabian Valencia & Mr. Luc Laeven, 2012. "Systemic Banking Crises Database: An Update," IMF Working Papers 2012/163, International Monetary Fund.
    22. Gros, Daniel, 2015. "Completing the Banking Union: Deposit Insurance," CEPS Papers 11143, Centre for European Policy Studies.
    23. repec:reg:rpubli:144 is not listed on IDEAS
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Lorenzo Esposito & Giuseppe Mastromatteo, "undated". "In the Long Run We Are All Herd: On the Nature and Outcomes of the Beauty Contest," Economics Working Paper Archive wp_972, Levy Economics Institute.
    2. Dóra Piroska & Yuliya Gorelkina & Juliet Johnson, 2021. "Macroprudential Policy on an Uneven Playing Field: Supranational Regulation and Domestic Politics in the EU's Dependent Market Economies," Journal of Common Market Studies, Wiley Blackwell, vol. 59(3), pages 497-517, May.
    3. Mérő, Katalin, 2019. "Érdemes-e csatlakozniuk az európai bankunióhoz az euróövezeten kívüli tagállamoknak? [Is it worth non-euro member-states joining the European Banking Union?]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(5), pages 497-520.
    4. Elisabetta Montanaro, 2016. "Central Banks And Financial Supervision; New Tendencies," Working papers wpaper134, Financialisation, Economy, Society & Sustainable Development (FESSUD) Project.
    5. Huizinga, Harry, 2018. "The Supervisory Approach to Anti-Money Laundering: An Analysis of the Joint Working Group’s Reflection Paper," Other publications TiSEM 1bb0eb51-d44b-46ab-87ae-6, Tilburg University, School of Economics and Management.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Vítor Gaspar, 2010. "Financial Stability and Policy Cooperation," Working Papers o201001, Banco de Portugal, Economics and Research Department.
    2. Haritchabalet, Carole & Lepetit, Laetitia & Spinassou, Kévin & Strobel, Frank, 2017. "Bank capital regulation: Are local or central regulators better?," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 49(C), pages 103-114.
    3. Segura, Anatoli & Vicente, Sergio, 2018. "Bank resolution and public backstop in an asymmetric banking union," ESRB Working Paper Series 83, European Systemic Risk Board.
    4. Näther, Maria & Vollmer, Uwe, 2019. "National versus supranational bank regulation: Gains and losses of joining a banking union," Economic Systems, Elsevier, vol. 43(1), pages 1-18.
    5. Belke, Ansgar & Dobrzańska, Anna & Gros, Daniel & Smaga, Paweł, 2016. "(When) should a non-euro country join the banking union?," The Journal of Economic Asymmetries, Elsevier, vol. 14(PA), pages 4-19.
    6. Cornelia Holthausen & Thomas Rønde, 2003. "Cooperation in International Banking Supervision," CIE Discussion Papers 2004-02, University of Copenhagen. Department of Economics. Centre for Industrial Economics.
    7. Haritchabalet, Carole & Lepetit, Laetitia & Spinassou, Kévin & Strobel, Frank, 2017. "Bank capital regulation: Are local or central regulators better?," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 49(C), pages 103-114.
    8. Schoenmaker, Dirk & Siegmann, Arjen, 2014. "Can European bank bailouts work?," Journal of Banking & Finance, Elsevier, vol. 48(C), pages 334-349.
    9. Hertig Gerard & Lee Ruben & McCahery Joseph A., 2010. "Empowering the ECB to Supervise Banks: A Choice-Based Approach," European Company and Financial Law Review, De Gruyter, vol. 7(2), pages 171-215, January.
    10. Holger Wolf, 2008. "Rethinking banking supervision in the EU," International Economics and Economic Policy, Springer, vol. 4(4), pages 357-361, February.
    11. Gazi I. Kara, 2016. "Bank Capital Regulations Around the World : What Explains the Differences?," Finance and Economics Discussion Series 2016-057, Board of Governors of the Federal Reserve System (U.S.).
    12. Dragos G. TURLIUC & Andreea N. POPOVICI, 2013. "TOWARDS THE EUROPEAN BANKING UNION-Literature review," SEA - Practical Application of Science, Romanian Foundation for Business Intelligence, Editorial Department, issue 1, pages 221-229, June.
    13. Iryna Okolelova & Jacob A. Bikker, 2022. "The single supervisory mechanism: Competitive implications for the banking sectors in the euro area," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 27(2), pages 1818-1835, April.
    14. Loranth, Gyongyi & Segura, Anatoli & Zeng, Jing, 2022. "Voluntary Support and Ring-Fencing in Cross-border Banks," Working Paper Series 2688, European Central Bank.
    15. Frisell, Lars & Roszbach, Kasper & spagnolo, giancarlo, 2008. "Governing the Governors: A Clinical Study of Central Banks," Working Paper Series 221, Sveriges Riksbank (Central Bank of Sweden).
    16. Holopainen, Helena, 2007. "Integration of financial supervision," Research Discussion Papers 12/2007, Bank of Finland.
    17. Berger, Helge & Hefeker, Carsten, 2006. "Does Financial Integration Make Banks Act More Prudential? Regulation, Foreign Owned Banks, and the Lender-of-Last Resort," HWWA Discussion Papers 339, Hamburg Institute of International Economics (HWWA).
    18. Robert A. Eisenbeis & George G. Kaufman, 2007. "Cross-border banking: challenges for deposit insurance and financial stability in the European Union," FRB Atlanta Working Paper 2006-15, Federal Reserve Bank of Atlanta.
    19. Haufler, Andreas, 2021. "Regulatory and bailout decisions in a banking union," Journal of Banking & Finance, Elsevier, vol. 133(C).
    20. Ampudia, Miguel & Beck, Thorsten & Beyer, Andreas & Colliard, Jean-Edouard & Leonello, Agnese & Maddaloni, Angela & Marqués-Ibáñez, David, 2019. "The architecture of supervision," Working Paper Series 2287, European Central Bank.

    More about this item

    Keywords

    EU financial supervision; banking union; non-euro countries; CEE countries; cross-border banking;
    All these keywords.

    JEL classification:

    • F35 - International Economics - - International Finance - - - Foreign Aid
    • F65 - International Economics - - Economic Impacts of Globalization - - - Finance
    • G01 - Financial Economics - - General - - - Financial Crises
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:psl:pslqrr:2016:22. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Carlo D'Ippoliti (email available below). General contact details of provider: http://www.economiacivile.it .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.