To measure the size of the banking system, a country's banking assets divided by the country's gross domestic product (GDP) is commonly applied as a yardstick. But is the banking assets to GDP ratio an appropriate yardstick? This paper shows that comparing a country's banking sector only by...

European Union (EU) countries offer a unique experience of financial regulatory and supervisory integration, complementing various other European integration efforts following the Second World War. Financial regulatory and supervisory integration was a very slow process before 2008, despite...

This paper focuses on the stability aspects of cross-border banking. We first argue that cross-border banking brings about various benefits and costs for financial stability. Based on this, we draw conclusions for the desirability of cross-border banking in the EU, and derive implications for...

The global financial crisis led to an alleged end of global banking. However, we find that reports on the end of global banking are premature. Investigating the global systemically important banks, we identify a strong composition effect: a shift of business from the global European banks to the...

The financial crisis had a major impact on the banking landscape. As troubled banks were rescued by their home country, the question arises what happened to cross-border banking. Our findings indicate that cross-border banking remains strong within Europe; the Single Market in Banking is still in...

In this paper we propose country-specific and systemic metrics that allow quantifying whether cross-border banking in a country (or region) takes a desirable form. Applying these metrics to the EU countries, we find that the countries with the largest banking centers, UK and Germany, are well...

The handling of cross-border banks in difficulties gives rise to coordination problems between home and host countries. Goodhart and Schoenmaker (2006, 2009) have suggested to implement an ex ante burden sharing mechanism to overcome the co-ordination failure of national authorities. While...

This paper focuses on the stability aspects of cross-border banking. We first argue that cross-border banking brings about various benefits and costs for financial stability. Based on this, we draw conclusions for the desirability of cross-border banking in the EU, and derive implications for...

On September 3-4, 2009 SUERF and Utrecht University School of Economicsorganized the Colloquium "The Quest for Stability" in Utrecht, the Netherlands. The papers included in this SUERF Study are based on contributions to the Colloquium.

The financial trilemma states that financial stability, financial integration and national financial policies are incompatible. Any two of the three objectives can be combined but not all three; one has to give. This paper develops a model to underpin the financial trilemma. Our findings for...