Abstract
The study presents the main stages of the development of the European financial supervisory regulation and the current European System of Financial Supervision. The financial economic crisis highlighted the weaknesses in the supervisory system and the fact that the supervisor has an important role in consumer protection and in the mitigation of risk-taking by financial institutions. The European Union has developed a new financial strategy known as Banking Union, which has a three-pillar framework. These three pillars are the Single Supervisory Mechanism, the Single Resolution Mechanism and the Common Deposit Guarantee Scheme. This system is intended to achieve a single economic and monetary union at supranational level and to avoid the emergence of a new crisis as far as possible.
Highlights
The establishment of an effective financial supervision system has been an important task as it had been shown by the recent financial economic crisis
The financial supervision as a subject matter of this article can be considered timely and up to date, for the reasons we have indicated above, and due to the overall reform of the legislation that took place a few years ago, and the practice resulting from the new provisions is only emerging
The European Central Bank (ECB) is competent to control the supervision of smaller banks carried out by the national supervisory authorities, the existence of prudential regulation corresponding to established by the Regulation (EU) rules, and the governance mechanisms within the banks
Summary
The establishment of an effective financial supervision system has been an important task as it had been shown by the recent financial economic crisis. The beginning of the crisis[1] was in 2007, and in 2008 it got to the European countries. The purpose of supervision is, regardless of the institutional form, to maintain the effectiveness of the existing regulation in the financial sector and the stability of the financial system (financial institutions and financial markets).[7] Financial stability is a condition in which the financial system – financial markets and financial institutions – is resistant to shocks affecting the economy and the ability to seamlessly fulfil the basic functions.[8] And this can be achieved if the risks are recognized in time and handled
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
