EU Banking Union: Sound in theory, difficult in practice

Abstract

In June 2012, the EU heads of state and government decided to pursue a so-called Banking Union as part of the effort to strengthen the cohesion of the European Union and to stabilise the eurozone. Banking Union is now part of the four frameworks — an integrated financial framework, an integrated budgetary framework, an integrated economic policy framework, and a framework for better democratic legitimacy and accountability — proposed by the President of the European Council, Herman van Rompuy, also in June, as the necessary elements for a genuine economic and monetary union.