First of all, the Economic and Monetary Union is a community of interest founded on a capacity for joint action and the application of rules. Rules can change, a point I will come back to, but first they have to be applied. It is a question of mutual trust, and in this the larger countries must set an example.
To understand this, let us break down the essence of financial intermediation – between savers in an economy (basically households) and borrowers. The core part of this financial intermediation is done by banks – through accepting deposits, extending credit and enabling payments. Since virtually all money (other than currency) is held as bank deposits, banks are at the centre of the payments system.