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Reforming European financial supervision: adapting EU institutions to market structures


Alexander, Kern (2013). Reforming European financial supervision: adapting EU institutions to market structures. ERA Forum, 14(1):81-93.

Abstract

The article analyses some of the legal and economic policy issues concerning proposals to establish a European Banking Union. It discusses the role of the European Central Bank as a bank supervisor and the creation of the Single Supervisory Mechanism (SSM). The article then critically analyses the draft Directive on Bank Recovery and Resolution (RRD) and argues that it is inadequate to serve as one of the pillars of banking union. The article reviews the difficulties of Member States in implementing the RRD by analysing the United Kingdom’s resolution framework as a case study. Finally, the article suggests that although strengthened powers for national resolution authorities are necessary to enhance the RRD, the logic of banking union demands further centralisation of sovereign authority in the Euro area in order to manage more effectively the resolution and recovery of financial institutions and to establish more institutional coherence with the ECB/SSM as bank supervisor. Further centralisation of banking supervision and resolution powers, however, could result in a deepening split in the EU internal market between member states not participating in banking union and participating states.

Abstract

The article analyses some of the legal and economic policy issues concerning proposals to establish a European Banking Union. It discusses the role of the European Central Bank as a bank supervisor and the creation of the Single Supervisory Mechanism (SSM). The article then critically analyses the draft Directive on Bank Recovery and Resolution (RRD) and argues that it is inadequate to serve as one of the pillars of banking union. The article reviews the difficulties of Member States in implementing the RRD by analysing the United Kingdom’s resolution framework as a case study. Finally, the article suggests that although strengthened powers for national resolution authorities are necessary to enhance the RRD, the logic of banking union demands further centralisation of sovereign authority in the Euro area in order to manage more effectively the resolution and recovery of financial institutions and to establish more institutional coherence with the ECB/SSM as bank supervisor. Further centralisation of banking supervision and resolution powers, however, could result in a deepening split in the EU internal market between member states not participating in banking union and participating states.

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Additional indexing

Item Type:Journal Article, refereed, original work
Communities & Collections:02 Faculty of Law > Institute of Legal Sciences > Business Law
Dewey Decimal Classification:340 Law
Language:English
Date:2013
Deposited On:27 Jan 2014 15:00
Last Modified:05 Apr 2016 17:32
Publisher:Springer
ISSN:1863-9038
Publisher DOI:https://doi.org/10.1007/s12027-013-0284-1
Related URLs:http://www.springer.com/law/international/journal/12027 (Publisher)
http://opac.nebis.ch/F/?local_base=NEBIS&CON_LNG=GER&func=find-b&find_code=SYS&request=006392247

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