The European banking authority is a necessary structure to ensure that banks are following safe, ethical guidelines. These guidelines are established to help protect the investor and the account holder and help ensure the future of a strong banking system. This, in turn, helps to maintain a strong and viable economy for the European Union.
Since its inception the European banking authority has received some amount of criticism regarding its establishment and its power to create transparent banking systems. The criticism comes from the idea that banks established outside of the authority will have a greater marketplace value because they are not subject to the same indicators of banks that are under the authority’s control. This is actually backwards when the factors that play into determining a bank’s actions are taken into account. The authority becomes a failsafe for the EU.
For the most part, the inception of the authority and its role has not been as clearly defined as it is expected to be over the next few years. As a relatively new entity there are still many systematic kinks to be worked out. As the role and power of the authority begin to become clearer, the general public will see how beneficial the role is to their livelihoods, security, and financial futures.
The European Banking Authority is a protective resource. Its main purpose is to ensure that universal or global markets do not follow suit should another powerful financial market crash.
The link between one country’s financial stability and the stability of other countries has recently become quite clear and there is a need for each individual country to take control of its own stability. The authority is there to do that for the EU. A number of European institutions are taking the matter very seriously, including the EESC.
With a little time and development, they should be able to establish a clear and wide set of regulations that will help keep the monetary system in check.
