The European banking union: what are the missing pieces?

Public lecture by Mr Fernando Restoy, Chairman, Financial Stability Institute, Bank for International Settlements, at the International Center for Monetary and Banking Studies, Geneva, Switzerland, 16 October 2018.

The success of the European banking union project should be gauged in terms of how far the process meets two objectives: ensuring a more closely integrated banking system in the euro zone; and denationalising the value of banks' liabilities. It is shown that progress is still incomplete on both fronts. In order to accomplish the set goals, it may be necessary to consider additional steps, including: (i) completion of a single rulebook; (ii) promotion of a more market-sensitive structure for the banking industry; (iii) swift action to address the implementation challenges of the new resolution framework for systemic banks; and (iv) development of a common administrative insolvency regime for non-systemic institutions.