As long as this is the case, country-specific shocks cannot be absorbed via integrated markets and procyclicality will prevail. Barriers to cross-border banking So what is holding back financial integration? And what are the barriers to more cross-border banking in Europe? The answer isn’t simple.
Today, it is hard to imagine M&A activity in Germany without the influence of the Anglo-American banking culture. Foreign banks play an important role in advising and assisting on German corporate bond issues; the same goes for IPOs and capital increases. The financial crisis has naturally also led to the market withdrawal of individual foreign banks.