The European approach to consolidated supervision in the banking sector

Abstract

The banking sector has experienced significant transformations in the past decades and the underlying reasons derive both from macroeconomic conditions and structural changes. The thesis aims to investigate banking consolidation, firstly by examining the motives for consolidating and the relative challenges, and secondly by analyzing recent trends in merger and acquisition activity in Europe and Italy. The study continues with an analysis on consolidated supervision, where the broad European Supervisory Framework is described and the European Central Bank "Guide on the supervisory approach to consolidation in the banking sector" (published in January 2021) is examined in detail. Lastly, an overview on cross-border integration of the European banking market is given, outlining the main advantages and exploring the key reasons why it has been limited during the past decades.