The Changing Role of Banking Supervision

[...]I will begin with deregulation. Compared with the regulatedEuropean financial systems of the postwar period, mostEuropean countries have been liberalizing their financialservices sectors. This trend began in the mid-1960s andaccelerated in the 1980s and 1990s. At the same time, Europeancountries have progressively opened their financial markets toforeign competition. These actions came about throughindependent national legislation as well as from the dynamicsof the Treaty of Rome, which received a renewed impetus from the single market program. Furthermore, the Second BankingCoordination Directive—implemented on January 1, 1993—introduced the single banking license, which allows creditinstitutions to establish branches or to supply cross-borderservices to all European Economic Area countries withoutprior approval from the authorities of a particular country.The European Union is aiming for a fully liberalized Europeanmarket for financial services by the year 2005.[...]