New institutional arrangements for bank supervision and resolution were needed to match the integrated structures of banking business. As a part of the economic and monetary union and as a remedy for future financial crisis, the EU leaders agreed in June 2012 on creating the Banking Union.
This environment has enabled credit to grow well above the level accommodated/ allowed by the deposit base, to the extent that external liquidity surpluses have been channelled through the banking system to meet internal financing needs. An overall context of ample liquidity has led to the perception that the easing of financing constraints would indefinitely be maintained.