After AQR and stress tests – where next for banking in the Eurozone?

Thorsten Beck 10 November 2014

a

A

The ECB has concluded and published the results of a year-long painstaking process to go through the books of the 130 largest and most important banks of the Eurozone, adjusting balance sheets and testing the sensitivity of their capital position to two different scenarios, one of which includes a severe economic downturn. This exercise constitutes the entry point to the Single Supervisory Mechanism (SSM), where the ECB has direct supervisory responsibility for most of these 130 banks and indirect responsibility for the rest of the banks in countries that are members of the SSM.

a

A

Topics:  Financial markets

Tags:  ECB, eurozone, banking union, stress tests, Asset Quality Review, forbearance, recapitalisation, balance sheets, leverage, bank resolution

Tax harmonisation in Europe: Moving forward

Agnès Benassy-Quéré, Alain Trannoy, Guntram Wolff 22 July 2014

a

A

The issue of tax harmonisation has been repeatedly debated in the EU since the European Economic Community was established. Substantial tax harmonisation exists in the area of indirect taxation, and proposals regarding corporations are on the table, such as the project of Common Consolidated Corporate Income Tax (CCCTB, see European Commission 2011a). According to widely accepted economic theory (Zodrow and Mieszkowski 1986), tax harmonisation is a way to curb tax competition that leads to either the under-provision of public goods or to burden-shifting from mobile to immobile tax bases.

a

A

Topics:  EU policies Financial markets Taxation

Tags:  EU, tax, multinationals, tax competition, tax avoidance, banking union, tax harmonisation, corporation tax, Tiebout competition, financial activity tax

Lacklustre investment in the Eurozone: Is there a puzzle?

Marco Buti, Philipp Mohl 04 June 2014

a

A

On the importance of investment for the Eurozone economy

According to the European Commission’s most recent forecast, real economic activity in the Eurozone is expected to recover at a moderate pace until 2015, and to remain significantly weaker than in the US (European Commission 2014a).

a

A

Topics:  EU policies Macroeconomic policy

Tags:  eurozone, growth, European Commission, investment, uncertainty, structural reforms, Bankruptcy, Eurozone crisis, public investment, banking union, financial fragmentation

Delivering the Eurozone ‘Consistent Trinity’

Marco Buti, Maria Demertzis, João Nogueira Martins 30 March 2014

a

A

As argued in an earlier commentary, the financial crisis exposed important economic inconsistencies in the way that EMU operated.1 Although progress has been made, the reality is that more needs to be done. A number of countries still need to consolidate their public finances further, and also implement structural reforms to promote growth and sustain satisfactory welfare systems. At the same time, there is a need for vulnerable countries to ensure consistency between regaining competitiveness and the sustainability of private and public debts.

a

A

Topics:  Europe's nations and regions Macroeconomic policy

Tags:  eurozone, euro, EMU, imbalances, fiscal policy, structural reforms, fiscal consolidation, debt, Eurozone crisis, Stability and Growth Pact, banking union, internal devaluation

The AQR and stress testing the European banking system

Viral Acharya interviewed by Viv Davies,

Date Published

Fri, 03/14/2014

a

A

See Also

Acharya, V and S Steffen (2014) "Falling short of expectations? Stress-testing the European banking system", VoxEU.org, 17 January.

a

A

Topics

Financial markets
Tags
banking, banks, systemic risk, recapitalisation, Eurozone crisis, banking union, bank capital, Asset Quality Review, stress testing

Related Article(s)

Banking union for Europe – where do we stand? Stress tests: a success for cooperation and transparency – and also very good for Spain A call for liquidity stress testing Bank resolution: from Cinderella to centre stage The urgent need to recapitalise Europe’s banks How much capital do European banks need?
MP3 File Details

Listen

Unfortunately the file could not be found.

Open in a pop-up window Open in a pop-up window

Download

Download MP3 File (18.4MB)

MP3 File Size

18.4MB

MP3 RSS File Size

19393169

MP3 Length (Minutes)

20

MP3 Length (Seconds)

12

When

February 2014

The limits to partial banking unions: A political economy approach

Octavia Foarta 02 February 2014

a

A

A key concern of policymakers following the Eurozone banking crises has been how to design common rules for public interventions in the banking sector. Recent proposals aim at creating a banking union to complement the Eurozone monetary union, and reduce the risk of contagion generated by cross-border spillovers from bank failures (Bolton and Jeanne 2013). The presence of spillovers suggests that a banking union may be welfare-improving for all member countries.

a

A

Topics:  EU policies Global crisis

Tags:  Political Economy, banking union, bank recapitalisation

Falling short of expectations? Stress-testing the European banking system

Viral Acharya, Sascha Steffen 17 January 2014

a

A

The Eurozone is mired in a recession. In 2013, the GDP of the 17 Eurozone countries fell by an average of 0.5%, and the outlook for 2014 shows considerable risks across the region. To stabilise the common currency area and its (partly insolvent) financial system, a Eurozone banking union is being established. An important part of the banking union is the Single Supervisory Mechanism, which will transfer the oversight of Europe’s largest banks to the ECB (Beck 2013).

a

A

Topics:  Financial markets

Tags:  banking, banks, systemic risk, recapitalisation, Eurozone crisis, banking union, bank capital, Asset Quality Review, stress testing

Why fiscal sustainability matters

Willem Buiter 10 January 2014

a

A

Does fiscal sustainability matter only when there is a fiscal house on fire, as was the case with the Greek sovereign insolvency in 2011–12? Far from it.

a

A

Topics:  Financial markets Global crisis International finance Macroeconomic policy

Tags:  eurozone, sovereign debt, capital flows, financial crisis, credit booms, fiscal policy, emerging markets, global financial crisis, banking, banks, Eurozone crisis, Currency wars, fiscal sustainability, banking union, sovereign debt restructuring, balance-sheet recession

Single supervision and resolution rules: Is ECB independence at risk?

Donato Masciandaro, Francesco Passarelli 21 December 2013

a

A

A successful transition to a European Banking Union requires robust and credible ‘Chinese walls’ between the ECB’s role as monetary authority and any responsibility in the Single Supervisory Mechanism or in the resolution rules. Otherwise, the ECB’s independence would be at risk, given that monetary policy would likely have larger distributional effects.

a

A

Topics:  EU institutions Financial markets

Tags:  ECB, Central Banks, central bank independence, global financial crisis, banking regulation, bank resolution, banking union

The new Single Bank Resolution Mechanism of the European Union

Stefano Micossi 30 November 2013

a

A

A banking union in Europe is essential to the long-run stability of the Eurozone (Draghi 2013 ). It will be built on three pillars:

  • A single supervisory mechanism.

The necessary regulation for this is already in force.

  • A single resolution mechanism.

This is now under negotiation before the European Parliament and the Council, with a political compromise likely to be reached at the forthcoming European Council meeting in December.

a

A

Topics:  EU institutions Financial markets

Tags:  bank resolution, banking union, bail-in

Pages

Events