The provisioning for non-performing loans as part of the Comprehensive Assessment takes us halfway towards a solution. What is now key is that written-down loans can be quickly restructured through more efficient insolvency regimes 10 or worked out privately through deepening markets for distressed debt.
The Capital Markets Union project could be an important catalyst here as it should ultimately induce convergence in both these areas. The third part is addressing the institutional incompleteness of our monetary union. There are several dimensions to this, as laid out in the recent Five Presidents’ Report, but a priority is completing Banking Union and the integration of the euro area banking sector.