This is the case throughout the world, also for the euro area. Perhaps this task is especially urgent for the euro area, because uncertainty regarding the health of banks aggravates the negative effects of economic imbalances and divergence in the area. A clear strengthening of the banks’ capital base is long overdue.
But one should consider that this package – beyond the 6 legislative acts – also contains three other strands: the Euro Plus Pact, the creation of the European Stability Mechanism and the setting-up of the European System of Financial Supervision. A fundamental strengthening of economic governance in the euro area requires simultaneous progress in all three areas.