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How Do Banking Supervisors Deal with Europe-wide Systemic Risk?

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  • Schüler, Martin
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    Abstract

    The systemic risk potential in the European banking market has increased. Hence, the following questions emerge: Is there a need for a truly European supervisory framework? And, how should a potential European supervisor be organised? This paper evaluates the existing supervisory framework as well as the recent proposal by the Economic and Financial Committee of the EU with respect to the increased Europe-wide systemic risk. We argue that cooperation between national supervisors even in the new framework will not be sufficient for safeguarding financial stability. As a consequence, we argue in favour of a European observatory of systemic risk. --

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    Bibliographic Info

    Paper provided by ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research in its series ZEW Discussion Papers with number 03-03.

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    Date of creation: 2003
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    Handle: RePEc:zbw:zewdip:899

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    Keywords: banking supervision and regulation; European Union;

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    Cited by:
    1. Edward J. Kane, 2005. "Can the European Community Afford to Neglect the Need for More Accountable Safety-Net Management?," NBER Working Papers 11860, National Bureau of Economic Research, Inc.
    2. Robert A. Eisenbeis, 2006. "Home country versus cross-border negative externalities in large banking organization failures and how to avoid them," Working Paper 2006-18, Federal Reserve Bank of Atlanta.
    3. Schüler, Martin & Schröder, Michael, 2003. "Systemic Risk in European Banking: Evidence from Bivariate GARCH Models," ZEW Discussion Papers 03-11, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    4. Masciandaro, Donato, 2007. "Divide et impera: Financial supervision unification and central bank fragmentation effect," European Journal of Political Economy, Elsevier, vol. 23(2), pages 285-315, June.
    5. Kane, Edward J., 2006. "Inadequacy of nation-based and VaR-based safety nets in the European Union," The North American Journal of Economics and Finance, Elsevier, vol. 17(3), pages 375-387, December.
    6. Schüler, Martin, 2003. "Incentive Problems in Banking Supervision: The European Case," ZEW Discussion Papers 03-62, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    7. Edward J. Kane, 2008. "Regulation and Supervision: An Ethical Perspective," NBER Working Papers 13895, National Bureau of Economic Research, Inc.

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