What is also important, however, is that the banking systems in some euro-area countries haven’t correctly fulfilled their economic function. And the national banking supervisory authorities have intervened too little, and too late.
Providing for a more stable financial system and contributing to a more efficient allocation of capital are the ultimate goals of the banking union, which will consist of a Single Supervisory Mechanism (SSM) and a Single Restructuring and Resolution Mechanism (SRM). To prevent future financial crises, an effective restructuring and resolution regime is of the essence.