After all, we have seen that government bonds are not risk-free. That is why the preferential regulatory treatment afforded to government bonds and other exposures to the public sector, in particular, needs to be brought to an end. The idea behind the banking union is a common financial regulatory framework, known as the Single Rulebook, and rests on two main pillars.
The first pillar is central, joint responsibility for banking supervision under the aegis of the ECB. This has already been put in place in the shape of the SSM. The second pillar is the SRM, which is responsible for the recovery and resolution of insolvent banks in times of crisis.