Regulatory Experience in the U.S. And Its Lessons for the European Union
20 Pages Posted: 1 Dec 2017
Date Written: July 28, 2014
Abstract
This paper looks at the challenges facing the Eurozone countries in establishing a banking union. Using the historical regulatory experience of the U.S. as a laboratory for comparative analysis, this article suggests that due to the diverse set of economies with competing local supervisors and diverse bankruptcy laws achieving the three “legs” of a European bank union, namely supervision, deposit insurance and restructuring/ resolution, is by no means an easy task. Even today, the U.S., despite having introduced its first national banking regulation in 1863, still falls short of what might be viewed as a full banking union, despite the existence of a common currency from at least 1913 with the foundation of the Federal Reserve. Whether the Europeans can tackle this challenge with such a diverse group of countries remains to be seen.
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