Advertisement

The Future of the European Banking Union: Risk-Sharing and Democratic Legitimacy

  • Pedro Gustavo Teixeira
Chapter

Abstract

This chapter looks at the future of the Banking Union. It focuses on two factors for its sustainability over time. First, the extent to which the Banking Union can rely on the existing risk-sharing mechanisms at the European level to address financial instability and systemic shocks. Second, the extent to which the Banking Union will be considered to have democratic legitimacy. These two factors are intertwined. As the Banking Union leads to much deeper integration than ever before, there will be distributive implications in periods of both financial stability and instability. The future of the Banking Union will depend on the extent to which it will be resilient at all times, not only with risk-sharing, but also with a democratic system that ensures that its distributive effects are perceived as legitimate.

Keywords

Banking Union Single Supervisory Mechanism Single Resolution Mechanism Risk-Sharing Democratic legitimacy 

References

  1. Binder J.-H. (2016), Resolution: Concepts, Requirements and Tools, J.-H. Binder and D. Singh (eds.), Bank Resolution: The European Regime, Oxford University Press, 25–59Google Scholar
  2. Chiti E. and Teixeira P. G. (2013), The Constitutional Implications of the European Financial and Public Debt Crisis, Common Market Law Review, 50-3, 683–708Google Scholar
  3. Constâncio, V. (2018), ‘Completing the Odyssean journey of the European Monetary Union’, Speech at the ECB Colloquium on “The Future of Central Banking”, available at https://www.ecb.europa.eu/press/key/date/2018/html/ecb.sp180517.en.html
  4. Draghi M. (2018), Risk-reducing and risk-sharing in our Monetary Union, Speech at the European University Institute, Florence, available at http://www.ecb.europa.eu/press/key/date/2018/html/ecb.sp180511.en.htmlGoogle Scholar
  5. Enria, A. (2018), ‘Fragmentation in banking markets: crisis legacy and the challenge of Brexit’, Speech at the BCBS-FSI High-Level Meeting for Europe on Banking Supervision, available at https://eba.europa.eu/documents/10180/2353431/Andrea+Enria+speech+on+Fragmentation+in+banking+at+BCBS-FSI+High+Level+Meeting+170918.pdf
  6. European Commission (2015), Towards the completion of the Banking Union, Communication from the Commission to the European Parliament, the Council, the European Central Bank, the European Economic and Social Committee and the Committee of the Regions, COM/2015/0587Google Scholar
  7. Ferran E. (2012), Understanding the new institutional architecture of EU financial market supervision, G. Ferrarini et al (eds.), Rethinking financial regulation and supervision in times of crisis, Oxford University Press, 11–58Google Scholar
  8. Five Presidents’ Report (2015), Completing Europe’s Economic and Monetary Union, available at http://ec.europa.eu/priorities/sites/beta-political/files/5-presidents-report_en.pdfGoogle Scholar
  9. de Gregorio Merino A. (2012), Legal developments in the economic and monetary union during the debt crisis: the mechanisms of financial assistance, Common Market Law Review, 49-5, 1613–1646Google Scholar
  10. James H. (2010), Central banks: between internationalisation and domestic political control, BIS Working Papers No 327Google Scholar
  11. Lamfalussy Report (2001), Final Report of the Committee of Wise Men on the Regulation of European Securities Markets, Brussels, available at http://ec.europa.eu/internal_market/securities/docs/lamfalussy/wisemen/final-report-wise-men_en.pdf
  12. De Larosière Report (2009), The High-Level Group on Financial Supervision in EU, Brussels, available at http://ec.europa.eu/economy_finance/publications/pages/publication14527_en.pdfGoogle Scholar
  13. Moloney N. (2014), European banking union: assessing its risks and resilience. Common Market Law Review, 51-6, 1609–1670Google Scholar
  14. Padoa-Schioppa T. (2004), Regulating finance: balancing freedom and risk, Oxford University PressGoogle Scholar
  15. Schinasi G. J. and Teixeira P. G. (2006), The Lender of Last Resort in the European Single Financial Market, IMF Working Papers 06/127, International Monetary Fund
  16. Schoenmaker D. and Véron N. (2016), European banking supervision: the first eighteen months, Bruegel Blueprint Series 25Google Scholar
  17. Spaak Report (1956), Comité Intergouvernmental crée par la Conférence de Messine, Rapport des Chefs de Délégation aux Ministres des Affaires Étrangères, BrusselsGoogle Scholar
  18. Teixeira P. G. (2017), The Legal History of the Banking Union, European Business Organization Law Review, 18, 535–565CrossRefGoogle Scholar
  19. Wojcik K.-Ph. (2016), Bail-in in the Banking Union, Common Market Law Review, 53-1, 91–138Google Scholar
  20. Zilioli Ch. (2016), The Independence of the European Central Bank and Its New Banking Supervisory Competences, D. Ritleng (ed.), Independence and Legitimacy in the Institutional System of the European Union, Oxford University Press, 125–179Google Scholar

Copyright information

© The Author(s) 2019

Authors and Affiliations

  • Pedro Gustavo Teixeira
    • 1
  1. 1.Institute for Law and Finance, Goethe-Universität, and European Central BankFrankfurtGermany

Personalised recommendations