Contours of the banking union within the integrated Europe: the Lithuanian case

The recent financial crisis has shown that certain institutions of the European Union (EU) and its Member States are poorly prepared for solving the issues created by difficulties experiencing banks in European markets. In order to be able to further provide services for citizens and companies, the governments of EU Member States had to support their banks with public finances and provide guarantees on an unprecedented scale. This averted the collapse of some banks and disturbance of the economy but put the burden on taxpayers. As a result, there was deterioration in public finances. The major responsibility for avoiding further deterioration should be assumed by the European Banking Union (EBU), also called as the Integrated Financial System (whose foundation occurred while Lithuania held the presidency of the Council of the EU in the second half of 2013). Taking into account this fact, there are several problematic aspects, connected to Lithuanian membership in the Banking Union, which are discussed in this paper