Advertisement

Assessments and Proposals

  • Christos V. Gortsos
Chapter
  • 5 Downloads
Part of the Palgrave Macmillan Studies in Banking and Financial Institutions book series (SBFI)

Abstract

Finally, this chapter contains the author’s assessments and proposals. Assessments (in the first section) pertain to the basic tasks of the European Central Bank (ECB) within the Eurosystem and some institutional aspects governing its operation, the necessary link between a more robust EMU and a well-functioning and financial stability-enhancing Banking Union (BU), as well as the positive effects and the concerns from the dual role of the ECB as monetary and banking supervisory authority. In the second section, specific modest proposals are put forward for an improved European bank safety net, which in the author’s view contains several elements of fragmentation (described as ‘partial Europeanisation of the bank safety net’), even after the establishment of the BU and even with regard to significant credit institutions. In this respect, apart from indicating that an important missing element in the architecture is harmonisation at EU level of the rules on winding up credit institutions, it proposes an enhanced role for the ECB in the provision of last-resort lending within the Emergency Liquidity Assistance mechanism and assigning it with powers relating to the provision of liquidity in resolution.

Secondary Sources

  1. Basel Committee on Banking Supervision. (2011). The Transmission Channels Between the Financial and Real Sectors: A Critical Survey of the Literature. Working Paper No. 18, February.Google Scholar
  2. BBVA. (2018, May). Funding Before and in Resolution: A Proposal for a Funding in Resolution Mechanism. Retrieved from https://www.bbvaresearch.com/wpcontent/uploads/2018/05/Liquidity-in-resolution_vFm.pdf.
  3. Brescia Morra, C. (2014). From the Single Supervisory Mechanism to the Banking Union: The Role of the ECB and the EBA. Working Paper No. 2, Luiss Guido Carli School of European Political Economy, Luiss University Press, Italy.Google Scholar
  4. Carletti, E., & Dell’ Ariccia, G. (2015). Supervisory Incentives in a Banking Union. Mimeo.Google Scholar
  5. Committee on the Global Financial System. (2011, July). The Impact of Sovereign Credit Risk on Bank Funding Conditions. CGFS Papers, No. 43, Bank for International Settlements.Google Scholar
  6. De Grauwe, P. (2013, February). Design Failures in the Eurozone: Can They Be Fixed? London School of Economics, “Europe in Question” Discussion Paper Series.Google Scholar
  7. De Groen, W. P. (2018, November). Financing Bank Resolution: An Alternative Solution for Arranging the Liquidity Required. Banking Union Scrutiny, In-depth Analysis, European Parliament, ECON Committee. Retrieved from https://www.europarl.europa.eu/RegData/etudes/IDAN/2018/624423/IPOL_IDA(2018)624423_EN.pdf.
  8. Demertzis, M., Raposo, I. G., Hüttl, P., & Wolff, G. (2018, November). How to Provide Liquidity to Banks After Resolution in Europe’s Banking Union. Banking Union Scrutiny, In-depth Analysis, European Parliament, ECON Committee.Google Scholar
  9. European Parliament. (2018, July). Banking Union: Towards New Arrangements to Finance Banks Under Resolution. Briefing. Retrieved from https://www.europarl.europa.eu/RegData/etudes/BRIE/2018/624402/IPOL_BRI(2018)624402_EN.pdf.
  10. Financial Stability Board. (2016). On the Temporary Funding Needed to Support the Orderly Resolution of a Global Systemically Important Bank (“G-SIB”). Retrieved from https://www.fsb.org/wp-content/uploads/Guiding-principles-on-the-temporary-funding-needed-to-support-the-orderly-resolution-of-a-global-systemically-important-bank-%E2%80%9CG-SIB%E2%80%9D.pdf.
  11. Goodhart, C. A. E., & Schoenmaker, D. (1993). Institutional Separation Between Supervisory and Monetary Agencies. In C. A. E. Goodhart (Ed.), The Central Bank and the Financial System. London: Macmillan Press.Google Scholar
  12. Gortsos, Ch. V. (2015a). The Single Supervisory Mechanism (SSM): Legal Aspects of the First Pillar of the European Banking Union. Athens: Nomiki Bibliothiki – European Public Law Organisation (EPLO).Google Scholar
  13. Gortsos, Ch. V. (2015b). Last-resort Lending to Solvent Credit Institutions in the Euro Area: A Detailed Presentation of the Emergency Liquidity Assistance (ELA) Mechanism. ECB Legal Conference 2015 – From Monetary Union to Banking Union, on the Way to Capital Markets Union: New Opportunities for European Integration, European Central Bank, December, pp. 53–76. Retrieved from https://ssrn.com/abstract=2688953.
  14. Gortsos, Ch. V. (2019). The Single Resolution Mechanism (SRM) and the Single Resolution Fund (SRF): Legal Aspects of the Second Main Pillar of the European Banking Union (e-book, 5th ed.). Retrieved from https://ssrn.com/abstract=2668653.
  15. Grünewald, S. N. (2017). Legal Challenges of Bail-in. ECB Legal Conference 2017 – Shaping a New Legal Order for Europe: A Tale of Crises and Opportunities. European Central Bank, December, pp. 287–310. Retrieved from https://www.ecb.europa.eu/pub/pdf/other/ecblegalconferenceproceedings201712.en.pdf.
  16. König, E. (2018, July). Speech at the ECON Committee, European Parliament. Retrieved from https://srb.europa.eu/en/content/speech-elke-konig-chair-srb-econ-committee-hearing-european-parliament.
  17. Lastra, R. M. (2012). The Evolution of the European Central Bank. Queen Mary University of London, School of Law Legal Studies Research Paper No. 99/2012.Google Scholar
  18. Lastra, R. M. (2015). International Financial and Monetary Law (2nd ed.). Oxford: Oxford University Press.Google Scholar
  19. Lastra, R. M., & Goodhart, Ch. (2015, September). Interaction Between Monetary and Bank Regulation. In-Depth Analysis, European Parliament, Directorate General for Internal Policies, IP/A/ECON/2015-07.Google Scholar
  20. Lastra, R. M., & Louis, J. V. (2013). European Economic and Monetary Union: History, Trends, and Prospects. Yearbook of Economic Law, pp. 1–150.Google Scholar
  21. Louis, J.-V. (1995). L’Union économique et monétaire. Commentaire Mégret: Le Droit de la CEE, 2nd ed., Etudes Européennes, Editions de l’ Université de Bruxelles, Vol. 6, Bruxelles.Google Scholar
  22. Mersch, Y. (2018, January). The Limits of Central Bank Financing in Resolution. Speech at the IMFS Distinguished Lecture Series Goethe Universität Frankfurt. Retrieved from https://www.ecb.europa.eu/press/key/date/2018/html/ ecb.sp180130.en.html.
  23. Moullin, O., Mazzocchi, S., Bannister, Ch., & Cencig, E. (2018, June). Liquidity in Resolution. Discussion Paper, Association for Financial Markets in Europe (AFME).Google Scholar
  24. Prati, A., & Schinasi, G. J. (2000). Financial Stability in European Economic and Monetary Union. In C. A. E. Goodhart (Ed.), Which Lender of Last Resort for Europe? (Chapter 3, pp. 69–173). London: Central Banking Publications.Google Scholar
  25. Psaroudakis, G. (2018). The Scope of Financial Stability Considerations in the Fulfilment of the Mandate of the ECB/Eurosystem. Journal of Financial Regulation, 4, 119–156.CrossRefGoogle Scholar
  26. Ringe, W. G. (2017). Bail-in Between Liquidity and Solvency. Oxford Legal Studies Research Paper No. 33/2016. Retrieved from https://ssrn.com/abstract=2782457.
  27. Schoenmaker, D. (2000). What Kind of Financial Stability for Europe? In C. A. E. Goodhart (Ed.), Which Lender of Last Resort for Europe? (Chapter 6, pp. 213–223). London: Central Banking Publications.Google Scholar
  28. Shambaugh, J. C. (2012). The Euro’s Three Crises. Brookings Papers on Economic Activity, Spring, The Brookings Institution, pp. 157–231. Retrieved from https://www.brookings.edu/~/media/Projects/BPEA/Spring%202012/2012a_Shambaugh.pdf.CrossRefGoogle Scholar
  29. Smits, R. (1997). The European Central Bank – Institutional Aspects. The Hague: Kluwer Law International.Google Scholar
  30. Thirion, G. (2017, January). European Fiscal Union: Economic Rationale and Design Challenges. CEPS Working Document, No. 2017-01. Retrieved from https://www.ceps.eu/system/files/WD2017-01GT%20FiscalUnion.pdf.

Copyright information

© The Author(s) 2020

Authors and Affiliations

  • Christos V. Gortsos
    • 1
  1. 1.Law SchoolNational and Kapodistrian University of AthensAthensGreece

Personalised recommendations