THE DYNAMICS OF EUROPEAN BANKING UNION: THE PROCESS OF ITS MAKING AND ITS ROLE IN FUTURE FINANCIAL AND ECONOMIC INTEGRATION

With halftime already over in preparation for European Banking Union (EBU), a dissection of how it is taking shape and options for its future development seems warranted. The decision of the European Council on June 29, 2012, vastly focused and accelerated the efforts of political decision-makers, legislators and financial experts at a euro area (and EU) level, justifying the assessment that EBU may be seen a quantum leap in European financial integration, corresponding to monetary integration in EMU (Veron 2013). There are, however, controversial approaches to defining the role of EBU in European economic and political integration. At one end of the spectrum, which we dub the 'missing link' view, is the assessment of EBU as a tool for stabilising EMU through disentangling monetary and fiscal policy (see Breuss 2012). At the opposite end, which we call the 'bridgehead' view, EBU is deemed a step into the new territory of fiscal, economic and political integration (Veron 2013). [PUB ABSTRACT]