As the UK prepares to vote on leaving the European Union, six of the bloc’s new eastern members face a different dilemma: whether or not to deepen ties with their eurozone neighbours by signing up to banking union.
It is a question that has been hotly debated ever since the concept of banking union was first floated at the height of the euro-area crisis in 2012. At stake for countries such as Poland, Hungary and Romania is loss of regulatory control over their own banking sectors. On offer is access to a resolution fund backed by the continent’s largest banks and, eventually, a supranational deposit guarantee scheme.
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| Mojmir Hampl, |
Today, as banking union starts to take shape, the discussion has moved from the theoretical to the practical – yet supervisors, bankers and analysts remain as divided as ever on the issue. So, four years on from the project’s genesis, how do the arguments for and against membership stack up for the eurozone ‘outs’ in central and eastern Europe?
Unsurprisingly, the Single Resolution Fund (SRF) tends to top the list of benefits.
