THE "EUROPEAN BANKING UNION AND THE NEW BANKING MODEL" CONFERENCE / DANIEL DĂIANU (ASF): "The Eurozone will hobble unless mutualization is achieved"

The financial system that we have is flawed, says Daniel Dăianu, first vice-president of the Financial Oversight Authority (ASF), who mentioned that any considerations he was making on the topic were on his own behalf. In his opinion, in order to have a healthy economic growth, a more robust financial system is needed.

Over the last two decades, robustness and resilience have decreased, as the financial systems have become increasingly vulnerable, and the financial situation has become increasingly fragile and a source of instability for the economy.

"Financial intermediation services in the advanced economies still have major flaws", he went on to say, and he emphasized that not all financial innovations are good and that the financial system is oversized.

Concerning the Eurozone crisis, the design is deficient and has major discrepancies, Mr. Dăianu considers: "The burden isn't being shared (...). The Eurozone will hobble, unless a level of mutualization is achieved. A union can not really exist, if the notion of solidarity isn't present".

The traditional and rational activity of banks has become perverted, considers Daniel Dăianu, who mentioned that there are talks over a universal bank model.

He also brought up the topic of speculative activities in banks, and he emphasized that we need much safer banking.

"The Banking Union is an attempt at deepening the integration in the financial sector", according to Daniel Dăianu, who thinks that the bail-in will increase financing costs and will increase the fragmentation of markets based on the performance of countries' economies.

He claims that the crisis in the East, which will affect capital flows and the entire banking sector, can not be ignored.

As for the economic activity in Romania, Mr. Dăianu considers that what is needed is a rethinking of economic growth, more saving and encouraging productive investments.

The relationship between the domestic authorities and the European ones is seeing new facets, he said. He expressed his support for regulating overseers and he praised the entry of Romanian-owned banks on the financial-banking market.