An unsustainable fiscal situation in one country has repercussions for monetary union as a whole. You can compare this to what economists call the “tragedy of the commons”. Just as overfishing creates negative externalities for other countries, excessive public debt harms the euro area as a whole. Excessive debt in one member state drives up longer-term interest rates for all euro-area countries.
All of these are done with the objective of making the regulatory environment more open to the business decisions of service and product providers. They broaden what can be achieved within the banking industry without unduly compromising the regulatory oversight for risks and conflicts of interest.