European Banking Union: Current Outlook and Short-Term Choices

The launch of Europe's banking union on June 29, 2012, was arguably the European Union's most consequential policy initiative since the start of its financial crisis in mid-2007. Banking union, defined as the transfer of banking sector policy from the national to the European level, is a highly ambitious project. Its completion will take many more years, but it is already changing the structures of the European financial system and has wide-ranging political implications. Its implementation to date, while protracted and far from straightforward, is broadly in line with the initial commitment.