Constancio hails Banking Union's ‘remarkable sharing of sovereignty'
SRM and SSM cannot eliminate the bank-sovereign feedback loop entirely
The two components of Europe's banking union that have been agreed so far – the Single Supervisory Mechanism (SSM) and the Single Resolution Mechanism (SRM) – will "help reduce the negative feedback loop between banks and sovereigns", ECB vice-president Vitor Constancio said today, "but do not completely eliminate it".
Addressing a Banking Union Conference at Spain's Navarra University today, Constancio pointed out that the absence of a common European bank recapitalisation mechanism means that
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