Banking supervision in European Union

Lavinia Mihaela Guțu and Vasile Ilie ()
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Lavinia Mihaela Guțu: PhD Student, Bucharest University of Economic Studies, Romania

SEA - Practical Application of Science, 2013, issue 2, 121-130

Abstract: The need for prudential supervision imposed to banks by law arises from the action that banking market’s basic factors have. Therefore, it is about banks’ role in economy. The normal functioning of banks in all their important duties maintains the stability of banking system. Further, the stability of the entire economy depends on the stability of the banking system. Under conditions of imbalance regarding treasury or liquidity, banks are faced with unmanageable crisis and the consequences can be fatal. To ensure long-term stability of the banking system, supervisory regulations were constituted in order to prevent banks focusing on achieving rapidly high profits and protect the interests of depositors. Starting from this point, this paper will carry out a study on existing models of supervision in the European Union’s Member States. A comparison between them will support identifying the advantages and disadvantages of each of them.

Keywords: banking supervision; banking regulation; financial stability; banking system (search for similar items in EconPapers)
JEL-codes: E58 G21 G28 (search for similar items in EconPapers)
Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:cmj:seapas:y:2013:i:2:gutu

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