Publications

Since Spain joined the Economic and Monetary Union (EMU) in 1998, its banking sector has undergone a radical transformation marked by various events. First, the adoption of the euro, which required adapting the main regulations affecting the sector, as well as accommodating its business model and development. This stage of intense growth following EMU entry and the macroeconomic implications of the euro – namely the removal of exchange rate risk between EMU partners, the progress in financial integration and the convergence of interest rates – fed a credit bubble that, in turn, led to a real estate bubble lasting until 2007. The second event was the start of the financial crisis in the summer of 2007 and the subsequent recession following the burst of the real estate bubble, which led to the bailout of Spain’s banking sector with European funds in 2012. The European Stability Mechanism made available to the Government of Spain a credit line of up to 100,000 million euros.1 The third event concerns the conditionality in the use of these bailout funds to comply with the obligations of the Memorandum of Understanding (MoU), which led to a period of radical transformation and restructuring of the banking sector, necessary to redress the imbalances accumulated in the past. Finally, with the birth of the European Banking Union (BU), and the implementation of the Single Supervisory Mechanism (SSM) in 2014 and the Single Resolution Mechanism (SRM) in 2015, the sector entered a new phase of adjustments to the BU, which takes us up to the present.

Martínez, C. and J. Maudos (2024). «Regulation and supervision of the Spanish banking sector in the context of EMU. The importance of the Banking Union». Quaderni di Ricerca Giuridica della Consulenza Legale no. 102 (September): 91-115.