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Designing a Financial Stability Architecture for a Regionally Integrated Financial Space: The European Experience

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  • Heinrich, Gregor

Abstract

Any discussion on improving the existing arrangements for assessing and managing financial risks and in particular supervising the relevant institutions will also need to address the question on which institution should be responsible for which task and for which sector of the financial system, how these institutions should be organized and, if there are several, how they should interact with each other. Based on the example of the European Union, this paper shows the gradual change from a rather loose rather idealistic cooperative framework among entirely independ-ent institutions, over the right to contribute to the functioning of policies set by others, on to the Single Supervisory Mechanism, a centralized structure in which – at least for the banking sector - the ECB takes on a rather powerful role of policy making, oversight and enforcement. (The paper was presented at the conference, “Financial Stability, Interconnectedness, and risk assessment in the Caribbean”, Port of Spain, Trinidad and Tobago, 19-20 March 2015.)

Suggested Citation

  • Heinrich, Gregor, 2015. "Designing a Financial Stability Architecture for a Regionally Integrated Financial Space: The European Experience," MPRA Paper 63225, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:63225
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    File URL: https://mpra.ub.uni-muenchen.de/63225/1/MPRA_paper_63225.pdf
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    References listed on IDEAS

    as
    1. Masahiro Kawai & Peter J. Morgan, 2014. "Regional financial regulation in Asia," Chapters, in: Masahiro Kawai & Peter J. Morgan & Pradumna B. Rana (ed.), New Global Economic Architecture, chapter 6, pages 112-147, Edward Elgar Publishing.
    2. Schoenmaker, Dirk, 2011. "The financial trilemma," Economics Letters, Elsevier, vol. 111(1), pages 57-59, April.
    3. Heinrich, Gregor, 2007. "Central banking in a regional economic setting: Possible contributions to integration," MPRA Paper 47416, University Library of Munich, Germany.
    4. Piet Clement, 2010. "The term “macroprudential”: origins and evolution," BIS Quarterly Review, Bank for International Settlements, March.
    5. Ms. Sumiko Ogawa & Mr. Joonkyu Park & Ms. Diva Singh & Ms. Nita Thacker, 2013. "Financial Interconnectedness and Financial Sector Reforms in the Caribbean," IMF Working Papers 2013/175, International Monetary Fund.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    financial stability; financial stability architecture; Caribbean; CARICOM; CCMF; European Union; European Central Bank; ECB; SSM; Single Supervisory Mechanism;
    All these keywords.

    JEL classification:

    • F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions
    • F55 - International Economics - - International Relations, National Security, and International Political Economy - - - International Institutional Arrangements
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • H12 - Public Economics - - Structure and Scope of Government - - - Crisis Management
    • K23 - Law and Economics - - Regulation and Business Law - - - Regulated Industries and Administrative Law

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