The Banking Sector and the State

As recent years have shown, there exist manifold linkages between the banking sector and the state. During the financial crisis, governments took extraordinary measures to ensure the proper functioning of financial markets and to prevent a collapse of the banking sector. As a result, risks moved from the banking sector to the public sector. On the other hand, banks usually hold large sovereign exposures, which helped countries to finance their budget deficits. This means, however, that the solvency of banks is inevitably linked to the solvency of the state. If the latter is imperilled, as is the case in some European countries, the consequences for the financial sector can be severe.

The conference is intended to address the above-mentioned questions, which are currently at the centre of the policy debate.