Friday

24th Nov 2017

Opinion

Banking union: No supervision without representation

  • Non-euro MEPs are wary of the creation of a two-speed Europe on the back of the crisis (Photo: EuroCrisisExplained.co.uk)

On 12 September the European Commission is to present first proposals on the banking union, which is the central element of the strategy to stabilise the economic situation in the eurozone.

During the EPP Group meeting in Florence, Commission President Barosso assured us that the single supervision mechanism will be open to all member states, including those which are not yet members of the eurozone. But can these states really agree to a mechanism where the European Central Bank is in control, yet they are not represented in its structures? It is likely that this is the choice they will be faced with.

Thank you for reading EUobserver!

Subscribe now for a 30 day free trial.

  1. €150 per year
  2. or €15 per month
  3. Cancel anytime

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

For group, corporate or student subscriptions, please contact us. See also our full Terms of Use.

If you already have an account click here to login.

The force behind the creation of a banking union is the eurozone crisis. But the implementation of this mechanism will have a substantial impact - also in financial terms - on the functioning of the banking sector across the Union. Let us not forget that in Slovakia, Hungary and the Czech Republic around 90 percent of banks are owned by banks from the eurozone. In Poland it is almost 70 percent of financial institutions. How will these markets be affected, if the parent bank is being supervised by the ECB, but the subsidiary bank is not - at least not directly?

It seems that it would be better to be under the umbrella of the banking union with all of its future elements, including the banking resolution fund and the deposit guarantee. We must ensure, however, that the non-eurozone member states and their interests are represented on an equal footing. The banking union project must not have negative spillovers on the non-eurozone member states.

Europe's unity and equality between member states must not be afterthoughts of the eurozone countries appearing only when we remind them. Nor should they be empty promises, while the solutions implemented exclude those not in the monetary union from the decision-making process of the supervision system being put into place. The only hope for negotiating an adequate representation of the non-eurozone countries lies in the fact that these decisions require unanimity among all 27 member states.

There are some proposals which seem to go into the direction of excluding the non-eurozone member states, creating a two-speed Europe with separate institutions for the eurozone. Germany's Handelsblatt newspaper recently wrote of potential plans to create a a separate parliament for the eurozone member states. Since the onset of the crisis the European Parliament has consistently rejected such proposals.

Undermining the integrity of the internal market and creating divisions within the Union will not help us get out of the crisis in the long-term. Nor will creating a new, divisive institution bring the Union closer to its citizens.

The writer is a Polish centre-right member of the European Parliament.

Discord simmers ahead of EU summit

It is being billed - by the Germans at least - as a "stepping stone" summit leading to firm decisions on further EU integration in December. But others want answers now.

Franco-German rift derails banking union deal

EU finance ministers will return to Brussels on the eve of the December EU summit next week for last ditch talks on the controversial banking union proposals, after failing to reach agreement on Tuesday.

Eastern partners, eastern problems

The EU must hold out the olive branch of possible membership in the distant future - but the current domestic problems in the ex-Soviet states, let alone their links to Russia make more than that difficult.

The anti-glyphosate lobby strikes again

Opponents of glyphosate too often rely on one - contested - piece of research, or smear their opponents as stooges for the chemicals industry.

EU must confront Poland and Hungary

Curtailing NGOs and threatening judicial independence are the hallmarks of developing-world dictators and authoritarian strongmen, not a free and pluralistic European Union.

News in Brief

  1. Merkel: Germany remains 'active' in EU
  2. Work with Israel, Egypt on gas exploration, says Commission
  3. Only seven EU states have 'advanced' stage climate plans
  4. EU dashes integration hopes of eastern countries
  5. EU approves joint Irish electricity scheme
  6. German president to launch 'Grand Coalition' talks
  7. Irish opposition 'threatens national interest', says minister
  8. SPD drops opposition to grand coalition in Germany

Stakeholders' Highlights

  1. EPSU-Eurelectric-IndustriAllElectricity European Social Partners Stand up for Just Energy Transition
  2. European Friends of ArmeniaSignature of CEPA Marks a Fresh Start for EU-Armenia Relations
  3. Nordic Council of MinistersNordic Energy Ministers Pledge to Work More Closely at Nordic and EU Level
  4. European Friends of ArmeniaPresident Sargsyan Joined EuFoA Honorary Council Inaugural Meeting
  5. International Partnership for Human RightsEU Leaders Should Press Azerbaijan President to End the Detention of Critics
  6. CECEKey Stakeholders to Jointly Tackle the Skills Issue in the Construction Sector
  7. European Friends of ArmeniaLaunch of Honorary Council on the Occasion of the Eastern Partnership Summit and CEPA
  8. Idealist Quarterly"Dear Politics, Time to Meet Creativity!" Afterwork Discussion & Networking
  9. EPSUStudy Finds TUNED and Employers in Central Governments Most Representative
  10. Mission of China to the EUAmbassador Zhang Ming Received by Tusk; Bright Future for EU-China Relations
  11. EU2017EEEstonia, With the ECHAlliance, Introduces the Digital Health Society Declaration
  12. ILGA EuropeFreedom of Movement For All Families? Same Sex Couple Ask EU Court for Recognition