Should the 'Outs' Join the Banking Union?

European Economy 2015.3, 89-112

24 Pages Posted: 10 Mar 2016

See all articles by Pia Huettl

Pia Huettl

Bruegel

Dirk Schoenmaker

Rotterdam School of Management, Erasmus University; Erasmus Research Institute of Management (ERIM); Centre for Economic Policy Research (CEPR)

Date Written: March 8, 2016

Abstract

The Single Market stimulates cross-border banking throughout the European Union. This paper documents the banking linkages between the 9 ‘outs’ and 19 ‘ins’ of the Banking Union. We find that some of the major banks, based in Sweden and Denmark, have substantial banking claims across the Nordic and Baltic region. We also find large banking claims from banks based in the Banking Union to Central Eastern Europe. These findings indicate that these ‘out’ countries could profit from joining the Banking Union, because it would provide a stable arrangement for managing financial stability. From a political perspective, member states’ opinion on joining the Banking Union ranges from an outright “no” towards considering Banking Union membership.

Keywords: Financial supervision, Banking Union, international banking

JEL Classification: G21, G28

Suggested Citation

Huettl, Pia and Schoenmaker, Dirk, Should the 'Outs' Join the Banking Union? (March 8, 2016). European Economy 2015.3, 89-112, Available at SSRN: https://ssrn.com/abstract=2744870

Pia Huettl

Bruegel ( email )

Rue de la Charité 33
B-1210 Brussels Belgium, 1210
Belgium

Dirk Schoenmaker (Contact Author)

Rotterdam School of Management, Erasmus University ( email )

P.O. Box 1738
Room T08-21
3000 DR Rotterdam
Netherlands

HOME PAGE: http://www.rsm.nl/people/dirk-schoenmaker/

Erasmus Research Institute of Management (ERIM) ( email )

P.O. Box 1738
3000 DR Rotterdam
Netherlands

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

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