The Eurozone Summit in June decided on a credible backstop for the European Resolution Fund, so that any bank resolution can be effectively managed with bail-in, without returning to the politically damaging bank bailouts and turning again to taxpayers’ pockets.
Moreover, ensuring financial stability calls for building a common European Deposit Insurance Scheme, to prevent any bank runs that can be very costly to the taxpayers and the society. These remaining elements would require convincing measures of risk reduction parallel to the founding of enhanced risk-sharing arrangements – possibly with some co-insurance features.