The mantra of the European authorities when talking about the completion of the Banking Union is that there needs to be risk reduction in the banking sector before introducing further mechanisms of risk sharing. What form of risk sharing might this take and what are the risks that banks need to reduce?
This white paper gives the most up-to-date overview of the European authorities Banking Union. It further examines how much risk reduction has already been achieved as well as the issue of illiquid assets.
The full paper is also available on Risk.net Library.