Banking Union Was Euro Crisis Turning Point

The two-year anniversary of a major event went curiously unnoticed at the end of last month. Europe's banking union, constituting a supranational pooling of most instruments of banking policy, was born in the early hours of June 29, 2012. This step marked a watershed in the European crisis, to a much greater extent than was initially realized by most observers, and is still acknowledged by many. The banking union made it possible for the European Central Bank (ECB) to stabilize sovereign debt markets. It will also profoundly reshape and realign Europe's financial system and institutions, with consequences that will unfold gradually over the next few years.