Financial fragmentation along national lines, which came to represent a hallmark of the euro area crisis, has been reversed by the European response to the crisis; financial integration is now back to a level comparable to pre-sovereign debt crisis levels, although some fragmentation still remains. However, the recent opposition to a common European Deposit Insurance Scheme is unwelcome news if not outright regress.
These measures will pay off in the long run and significantly  BIS Review 161/2010  3  enhance the stability of the financial system. I do not share the often-voiced fears in this connection about an excessive burden being placed on the banking sector. Nevertheless, there remains much to be done.