How do bank supervisors strike a balance between market self-regulation and pro-active regulatory intervention? This book investigates the choice of banking supervision approach in four European Union member states from Central and Eastern Europe – Bulgaria, Estonia, Hungary, and Slovenia – after their transition to democracy and market economy. Drawing on interviews with bank supervisors and decision-makers, the study examines why the four states show different calibrations of the balance between market-based regulation and risk-averse counter-cyclical regulation across countries and over time. The book sheds lights on a core tension in the European Banking Union: should rules be homogenous across jurisdiction to ensure a level playing field, or should national regulators have room to impose stricter or more lax regulations?
