A highly integrated financial system is also necessary for the efficient functioning of the single monetary policy, because integrated financial markets ensure a smooth and balanced transmission of monetary policy throughout the euro area. For this reason in particular, the Eurosystem decided that the promotion of financial integration would form part of its “mission”.
Asymmetry in supervision When different market participants are regulated by separate supervisors, it is difficult to maintain comparable quality of policy formulation and vigilance. The asymmetry of regulatory regime can arise within one country e.g. between banks and securities firms, as well as on cross-border level.