As the general economic context created by exacerbation of the global financial crisis has heavily affected the European Union (EU) banking sector, taking into account the systemic nature of this sector and its importance for the European economy, substantial government support took off, in the form of state aid directed primarily to the financial sector. Thus, while many Member States have proclaimed the introduction of new measures with the purpose of supporting their financial institutions and contributing effectively to providing common financial market stability, the European Commission has emphasized the urgency that such help is conducted at EU level. Accordingly, since the economic situation in several Member States was critical and there was a serious risk of a potential negative impact on the overall European financial market, the European Commission considered as appropriate to adopt a series of regulations in order to combat the crisis in the banking sector more specifically. Hence, through the coordinated effort of national authorities and the measures taken by each Member State, correlated with the European Commission's State aid control discipline and guidance for general schemes, as well as for ad-hoc interventions at country level, it became possible not only to recover the confidence in the financial markets, but also to stabilize and restore them, avoiding single market distortions and mitigating moral hazard.In the light of the above, this paper firstly aims to present and analyze through a comparative approach the total amount of national State aid measures that has been given to the European financial sector since the start of the crisis to the present, and, furthermore, to assess the form and type of the aid granted to the financial sector, by comparing the actual aid level of the different measures. Subsequently, our article will focus on the effectiveness and efficiency of policy interventions, considering the fact that state aid to the financial sector has accounted for the bulk of the overall EU State aid during the crisis. Finally, the paper will address the role of the unprecedented amount of state aid used by the member states for their financial sectors in restoring the financial stability and the normal functioning of the European financial market
