"Why do we need a Banking Union? I believe that the Banking Union will provide a stable basis on which to build greater financial stability; that can help support future growth via a healthier, more resilient banking sector; and that can ultimately regain the market confidence this crisis has shattered. Financial fragmentation should diminish and credit to the real economy should be reactivated: this is an important pillar of our comprehensive strategy for growth and investment," said Commissioner Katainen.
"The financial crisis has made clear that not only for those countries which share the euro, but for the European Union as a whole, a deeper economic and monetary union and an integrated banking system are needed to support long-term financial stability. Banking Union is therefore not only a crisis management tool that enables us to repair the damage done by past loopholes or oversights. The objectives at its very core are to restore the proper functioning of the internal market by mitigating fragmentation, ending unnecessary national ring-fencing and thus completing the architecture of the economic and monetary union, as well as of the EU as a whole.
At its core lies a set of harmonised rules and powers applicable to all 28 Member States. The so-called single rulebook brings us significantly closer to comparing apples to apples and oranges to oranges across Member States. Although future work will be required to complete the necessary adjustment, the new regulatory framework establishes common rules for credit institutions and investment firms in all 28 Member States, laying down improved capital requirements for the banking sector, regulating the prevention and where necessary management of bank failures, and ensuring better protection and greater transparency for depositors.
But we did not stop there. We have moved on to secure a centralised system of decision-making that will address fragmentation concerns. The two pillars of Banking Union now nearing completion represent a move towards a perspective of common utility as opposed to individual interest. While I acknowledge that this shift in perspective has been difficult and will not be completed overnight, I would remind us all that these very topics and initiatives would have been taboo or even unimaginable just a few years ago."
Speech
© European Commission
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