CEPS Director Daniel Gros has contributed a chapter to a new eBook published by VoxEU.org, entitled Europe’s Political Spring: Fixing the Eurozone and Beyond, edited by Agnès Bénassy-Quéré and Francesco Giavazzi. Encouraged by the election of Emmanuel Macron in May 2017, a group of leading economists from across Europe were asked to propose politically feasible and practical solutions in this new book to completing the eurozone’s economic architecture.

In his chapter, entitled “Try again to complete the Banking Union!”, Gros acknowledges the important steps that have been taken towards centralisation of bank supervision alongside bail-in rules to reduce moral hazard and the creation of a common fund for resolution. But he argues that the new bail-in rules have not been fully applied and that banks are too much exposed to their own sovereign. The Banking Union needs to be underpinned by a back-up system for national deposit insurance and an overall backstop.

Download the full eBook here