It is very likely that, in a year’s time, the deficits in many euro-area countries will be between 5% and 7% up from 3% now, while public debt may rise by 10 to 20 percentage points.
The introduction of European banking supervision has brought about fundamental improvements in this regard, as it facilitates the assessment of relevant information within the legal limits of the separation principle. Moreover, we will have to balance the aim of returning to the simplicity of our previous framework with adapting to the new realities of the financial system.