Montalbano competing interest groups and lobbying in the construction of the european banking union (2021)

ABI Italian Banking Association AEB Spanish Banking Association AFME Association for Financial Markets in Europe BaFin German Federal Financial Supervisory Authority BBA British Bankers’

Competing Interest Groups and Lobbying

in the Construction

of the European

Banking Union

Giuseppe Montalbano

Construction of the European Banking Union

Competing Interest Groups and Lobbying

in the Construction of the European Banking

Union

ISBN 978-3-030-65424-5 ISBN 978-3-030-65425-2 (eBook)

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Department of Political Science

LUISS Guido Carli Free International University

Rome, Italy

This work is the product of a long journey that started with my Ph.D at LUISS Guido Carli in Rome and continued in the subsequent post-doc years, going through many phases of my academic life, changes of mind, and challenges For sure, the birth and realization of this book would not have been possible without those scholars and friends who have accompa-nied me in the course of its development and several remakes First of all,

I have to thank Leonardo Morlino for having accepted to be my Ph.D supervisor at LUISS Guido Carli and for guiding me in the thesis work I want to reserve a special thanks to Bastiaan Van Apeldoorn, whose work has been a veritable source of inspiration for my thesis and who then became a precious guide in the development of my research project as co- supervisor Of course, my Ph.D project has been enriched, thanks to the fruitful dialogue and exchanges with my colleagues and scholars at LUISS.  In particular, I would like to thank Raffaele Marchetti for his advice on issues related to participatory democracy and Civil Society engagement at the EU level; Domenico Melidoro, for being a unique reference point during the Ph.D years; Silvia Menegazzi, for our conver-sations and mutual support Particular thanks are due to Mario Telò, who introduced me to teaching International Relations and European Integration, becoming a key reference figure for my academic career growth.After my Ph.D., the continuation, refinement, and further develop-ment of this work owe much to scholars and colleagues who enriched my understanding of the EU financial regulation through their suggestions, constructive criticisms, and confrontations Thus, I have to thank Manuela Moschella for giving me the opportunity to work at the Department of

Political Science of the Scuola Normale Superiore in Florence and all the post-doc colleagues at Palazzo Strozzi, in particular the “quartermaster” Lorenzo Zamponi and Loris Caruso During my post-doc in Florence, I had the luck to meet Lucia Quaglia, whose advice and support have been invaluable for the prosecution of this research and to whom I want to give

a special acknowledgment here The conferences and seminars in my post- doc years have been a unique source of stimulus and advice from outstand-ing scholars and colleagues who contributed unwittingly to the further elaboration of this work Here I would like to recall and thank Daniel Mügge, Eleni Tsingou, Leila Simona Talani, Radhika Desai, David Howarth, and Huw Macartney for their observations, criticisms, and suggestions

Lastly, my gratitude goes to all those friends of mine around Italy and Europe who, at the same time, put up with me and supported in the ups and downs of such a research journey: my music-mates “Utveggi,” my old and new colleagues at Scuola Normale and LUISS Guido Carli, and my

“battle buddies” in Pisa, Rome, and around Italy However, a special place must be reserved for Claudia, who supported me more than anyone else, being always close to me, even at a distance

My last thanks go to my brother and first among all the friends of mine, Gabriele, and to my parents, Maria Teresa and Luigi, to whom this book

is dedicated

Part II 97

4 The Supranationalization of Banking Supervision in Europe 99

The Construction of the Single Market and the Idea of a Single

The BRRD in the Context of the SRM 158

The Construction of the SRM 165

Setting the Principles for Global Deposit Insurance 199

The Revision of the DGS Directive 201

The Prospects of the EDIS 213

The Stalemate in the EDIS Negotiations 221

Basel III and the Commission Proposal 235

The CRR/CRD IV Package 244

A Banking Package to Get the Post-crisis Job Done? 246

Banks Efforts to Review the CRR/CRD IV 248

The Commission Proposal of a Banking Package 255

Negotiating the Banking Package 258

Final Regulation and Directive 261

8 The Forgotten Pillar: On the Rise and Fall of the Banking Structural Reform 277

On the International Agenda 279

The Liikanen Report and the Commission Proposal 281

The Reform Initiatives in the UK, Germany, and France 283

The Stakeholder Consultations 289

The Commission Proposal 292

The Draft ECON Report 295

The Council Agreement 296

The Stalemate and Failure of the Reform 297

ABI Italian Banking Association

AEB Spanish Banking Association

AFME Association for Financial Markets in Europe

BaFin German Federal Financial Supervisory Authority

BBA British Bankers’ Association

BCBS Basel Committee on Banking Supervision

BDB Association of German Banks

BDI Federation of German Industries

BEUC European Consumer Organisation

BIS Bank for International Settlements

BPCE Banques Populaires et Caisses d’Epargne

BRRD Bank Recovery and Resolution Directive

BSR Banking Structural Reform

BVR Association of German Cooperative Banks

CEBS Committee of European Banking Supervisors

CEECs Central and Eastern European Countries

CMU Capital Markets Union

CRD Capital Requirements Directive

CRR Capital Requirements Regulation

DG FISMA European Commission Directorate General Financial Stability,

Financial Services and Capital Markets Union

DGS Deposit Guarantee Scheme

DK German Banking industry Committee

DSGV Association of German Savings Banks

EACB European Association of Co-operative Banks

EAPB European Association of Public Banks

EBA European Banking Authority

AbbreviAtions

EBF European Banking Federation

EBIC European Banking Industry Committee

EBU European Banking Union

ECB European Central Bank

ECOFIN Economic and Financial Affairs Council

ECON European Parliament’s Committee on Economic and

Monetary Affairs

EDIS European Deposit Insurance Scheme

EFDI European Federation of Deposit Insurers

EFR European Financial Services Round Table

EFSF European Financial Stability Facility

EMU Economic and Monetary Union

EP European Parliament

EPFSF European Parliamentary Financial Services Forum ESA European Supervisory Authority

ESBG European Savings and Retail Banking Group

ESFS European System of Financial Supervision

ESM European Stability Mechanism

ESRB European Systemic Risk Board

FBF French Banking Federation

FSA Financial Services Authority

FSAP Financial Services Action Plan

FSB Financial Stability Board

G20 Group of Twenty

G30 Group of Thirty

GDP Gross Domestic Product

GFMA Global Financial Markets Association

HLEG High-Level Expert Group

HSBC Hong Kong and Shanghai Bank of Commerce IADI International Association of Deposit Insurers

IIF Institute of International Finance

IMF International Monetary Fund

IPE International Political Economy

IRB Internal Ratings-Based Approach (Risk Calculation) ISDA International Swaps and Derivatives Association LCR Liquid Capital Ratio

LIBA London Investment Banking Association

LTRO Long-Term Refinancing Operation

MEDEF Movement of the Enterprises of France

MEP Member of the European Parliament

MOU Memorandum of Understanding

MPS Monte dei Paschi di Siena

NFC Non-financial Company

NSFR Net Stable Funding Ratio

NVB Dutch Banking Association

RBS Royal Bank of Scotland

SGP Stability and Growth Pact

SIFMA Securities Industry and Financial Markets Association in the US SMEs Small and Medium-Sized Enterprises

SRB Single Resolution Board

SRF Single Resolution Fund

SRM Single Resolution Mechanism

SSB Single Supervisory Board

SSM Single Supervisory Mechanism

TEU Treaty on European Union

TFEU Treaty on the Functioning of the European Union

UEAPME European Association of Craft, Small and Medium-Sized

Enterprises

VÖB Association of German Public Banks

VZBV German Consumers Association

ZKA German Banking Industry Committee

Fig 3.1 Return on equity (RoE), percentage, EU banks 55 Fig 3.2 Gross non-performing loans as percentage of total gross loans 58 Fig 3.3 Market concentration Shares of five largest credit institutions in

total assets (C5) and Herfindahl-Herfindahl Index (HHI) 60 Fig 3.4 Interbank market dependence, EU large banks, total EU and

Fig 3.5 Short-term wholesale funding ratio, as percentage of total items

Fig 3.6 News coverage, keywords “banking crisis” and “banking

reform/regulation,” 2007–2018, selected news outlets,

Fig 3.7 News coverage, keywords “banking crisis” and “banking

reform/regulation” (combined), 2007–2018, selected news

outlets, percentage of total news Selected EU countries 90 Fig 4.1 News coverage, keywords “bank supervision” and

“Eurozone crisis,” selected newspapers, percentage of total

Fig 5.1 News coverage, keywords “bank resolution” and “bank

bail-out.” Selected newspapers, percentage of all news,

2007–2018 150 Fig 6.1 News coverage, keywords “deposit insurance” and “debt

mutualization,” selected newspapers, percentage of total news, 2008–2018 207 Fig 6.2 News coverage, keywords “debt mutualization,” selected

newspapers, single countries, percentage of total news,

2008–2018 210

list of figures

Fig 7.1 News coverage, keywords “banks’ capital and liquidity

requirements” and “bank reform,” selected newspapers,

Fig 8.1 News coverage, keywords “banks too big to fail,” selected

newspapers, percentage of all news, 2007–2018 284

© The Author(s), under exclusive license to Springer Nature

Switzerland AG 2021

G Montalbano, Competing Interest Groups and Lobbying in the

Construction of the European Banking Union,

https://doi.org/10.1007/978-3-030-65425-2_1

Introduction

We need a new deal between financial regulation and society A deal in which financial services are back at the service of the real economy And at the service of citizens… (Barnier 2010)

The atmosphere at the 8th European Financial Services Conference in April 2010 was rather tense The call for a “new deal” by Commissioner Barnier, head of the directorate on financial services’ regulation in the European Union (EU), did not bode well for the representatives from the European banks and financial firms present in the room Those bankers and financiers were among the principal signatories of an old tacit deal, whose sudden and violent disruption started in the second half of 2007, in what the International Monetary Fund (IMF) labeled as the worst finan-cial crisis since the Great Depression (IMF 2008: 4) Outside the BNP Paribas Fortis Auditorium, the global financial turmoil was still unfolding and triggering in those same months the outburst of the Eurozone sover-eign debt crisis The dominant regulatory philosophy, which drove the extraordinary expansion of the financial markets between the US and the

EU from the 1990s onward, turned against the same policy communities which nurtured it Governments, regulators, and even market incumbents questioned the excessive confidence in a general market-led approach, dominant in the US and UK regulatory infrastructure, bringing to the liberalization and expansion of the international financial markets An

optimistic reliance on the financial markets’ self-discipline and benefits favored a spectacular growth of increasingly risky and remunerative busi-ness (Foster and Magdoff 2009; Posner 2009) An essential premise for such a mounting disaster was the spread of a “market-based” banking model, defined as the dependence of the banks’ business and profits, including core retail activities, in the financial markets (Hardie and Howarth 2013: 24–27) Market-based and investment banking developed

in parallel with the construction of an EU single market in financial vices and the Economic and Monetary Union (EMU) In those years of monetary and financial integration, the majority of EU States differently experienced a growth in the financial services compared to their gross domestic product, based on the banks’ increasing reliance on the securiti-zation activities and other structured products, which boosted profits together with the debt levels The expansion of cheap consumer credits and the development of private indebtedness provided a temporary legiti-macy of the financialization process (Epstein 2005; Duménil and Lévy 2004; Abdelal 2007), by forging the indebted governments and citizens

ser-as new main characters of a financial and private Keynesianism (Crouch 2009; Bellofiore 2012, 2013; Bellofiore and Halevi 2010) In the run-up

to the crisis, banks from Germany, the UK, and Northern countries neled their credit flows into the euro-periphery, fueling its private indebt-ment and crucially contributing to deepening the structural economic divergencies within the Eurozone (Tooze 2018: 101–6) At the same time, the growth in consumption and the real estate boom in Southern Europe were premised on the increasing exposure of the domestic banks

fun-to the international financial markets, the rapid de-industrialization of the national economies, and the related deterioration in the current account balances (Bellofiore et al 2011; Lindner 2013; Celi et al 2017: 69–70, 101–106) The outburst of the global financial crisis suddenly interrupted the financial flows and the banks started to cut their riskier exposures The economically weaker countries and their banking sectors in Europe were left to sink in the absence of a common fiscal safety net, triggering a large- scale sovereign debt crisis and recession, which would amplify the macro-economic asymmetries among Eurozone countries The fragile financial-based order underpinning the EMU collapsed, revealing the structural and institutional flaws of the Eurozone A huge bill to pay was then presented to the most vulnerable citizens and social groups across Europe The deal between policy-makers and bankers waned and the trust toward finance eroded

As the states heavily intervened in US and EU Member States to bail out defaulting banks with taxpayers’ money (Grossman and Woll 2014; Woll 2014; Culpepper and Reinke 2014), the financial sector’s responsi-bilities came to the spotlight of the public opinion The privileged and behind the scenes relationship with national and European policy-makers was suddenly disrupted In this way, the global turmoil determined a legit-imacy crisis of the previous market-based financial governance (Helleiner

2010, 2014: 94–100; Helleiner and Pagliari 2010, 2011; Baker 2010), leading to a deep re-orientation of the international financial regulatory community

In the peculiar case of the EU, the banking crisis threatened the same viability of the EMU and the prospects of European integration The impact of the US-subprime crisis in Europe unveiled the inner tensions resulting from the design of the monetary union The Eurozone integra-tion was premised in the problematic coexistence of the common cur-rency, the liberalization of capital markets and the competition of national banking systems embedded in variegated public/private patterns of capi-talist developments, without a centralized supervisory and crisis manage-ment authority, and the lack of a Europeanized lender of last resort function to compensate the loss of monetary policy at home (Schoenmaker 2011; Toporowski 2015) The common currency narrowed the economic sovereignty of the Member States, while incentivizing a market-led provi-sion of cheap credit and the expansion of securities markets Likewise, the enhanced international capital mobility and the loss of monetary authority made the States’ competitiveness and financing needs increasingly depen-dent on financial markets, leaving them with no other adjustment strategy than the internal devaluation In such a context, the national banking sec-tors expanded their activities and profits thanks to the favorable market conditions created by the monetary union, capital liberalization, and the building up of the Single Market in the Financial Services, fostering the competitive positions of cross-border firms (Bieling 2006; Bieling and Jäger 2009) Thus, the compromises and loopholes in the building up of the EU financial regulatory framework unfolded through the conflicts among national strategies of restructuration and the interests of transnational- oriented constellations of actors (Mügge 2006, 2010)

In such a process, the Member States’ authorities protected and tivized the domestic-oriented financial firms’ expansion under nationally fragmented supervisory authorities and regulatory discretions (Quaglia 2010; Epstein and Rhodes 2016; Epstein 2017: 30–34) Thus, domestic

incen-banks developed in symbiosis with national authorities exploiting the opportunities opened by the EMU, while the States became increasingly subjected to the international markets, being deprived of the monetary authority, without a correspondent lender of last resort, a macroeconomic and fiscal authority, and a common supervisory infrastructure at the EU level (Schoenmaker 2011, 2013: ch 1) From 1999, the development of financial markets and products in a new competitive race between US and European banks prompted the concentration of risks and opened the channels of potential contagion in the Eurozone, bolstering the interde-pendence and reciprocal vulnerability of States and banks The European banks came to internationalize themselves, while remaining rooted in the respective States as a last resort guarantee against the systemic accumula-tion of financial risks, which then became implicitly collectivized (Epstein and Rhodes 2014: 9) The competition among EU banking interests nur-tured the expansion of domestic financial firms, as well as cross-border champions, while feeding those systemic vulnerabilities triggering the 2007/2008 financial crisis in the EU. Such institutional flaws and compe-tition dynamics interacted in the context of a global credit boom, steadily inflating the private and public debts in a context of sluggish economic growth among euro-periphery countries, setting the premises for the ris-ing current account imbalances within the Eurozone The banks who inflated the financial bubble and saw their profits soar in the pre-crisis years were now the same to be rescued with taxpayers’ money to prevent the collapse of the European economies At the center of the global finan-cial turmoil and its transmission into the Eurozone crisis, the bankers and their responsibilities became the major target of an international reform agenda.

Rewriting the banks’ rules soon became the grounding premise for that

“new deal,” which would have to resolve a “double” financial and tial crisis for the European project Such a deal took form in a tight EU reform agenda on all the key aspects related to the existing banking regu-lation: from the supervision of the credit institutions to their crisis man-agement and the prudential requirements, up to the protection of the banks’ depositors and the putting into question of the same bank business structures At the height of the sovereign debt crisis, the overhaul in bank-ing regulation became the basis of a major institutional innovation in European integration history The project of a European Banking Union (EBU) emerged in the first half of 2012 as a major and viable response to end the Eurozone crisis and fix the flaws in the EMU, which resulted from

existen-a cross-border bexisten-anking integrexisten-ation without correspondent suprexisten-anexisten-ationexisten-al supervision, resolution, deposit insurance, and financial backstop Integrated banking governance in the Eurozone was intended to break the reciprocal risk transmission links between bank and sovereign debts and halt the EMU fragmentation In this way, the prospected deal between finance and society would have paved the way for the euro’s future and the same European integration.

The main question of this study can be summarized as follows: what have been the terms and contents of this emerging “new deal” between financial regulation and society in the EU? A question inseparable from a second one: who were the most influential drafters and the actual signato-ries of such a new deal? What were the key interests and societal groups at stake in the EU post-crisis reform process and the ensuing design of the Banking Union?

The ArgumenTThis book addresses the above questions by investigating the interests and influence of the banking industry in the post-crisis regulatory reform of the EU banking governance and the overall design of the Banking Union The argument here presented is that the élite of banks retained the capac-ity to condition a new deal between finance and society in Europe, although in different terms with respect to the pre-crisis one While endowed with fundamental structural and lobbying resources to advance their preferences in the reform process, the banking industry had to face a politicized regulatory environment, requiring a re-orientation of their strategies and goals From one side, the cross-border banking interest groups engaged in the reform agenda to promote and steer the suprana-tionalization of financial regulation in Europe, as a fundamental goal that soon overlapped with those of the EU regulators On the other side, the increased policy salience of banking regulation after the crisis opened unique windows of opportunity for pro-regulatory societal interests and policy entrepreneurs to sustain a hard-regulatory agenda In such a con-text, the bankers’ chances to influence the policy-making process hinged

on their capacity to build up broader alliances at the domestic and European levels As it will be shown, European bankers tried to mediate between two imperatives for the EU policy-makers: (re)regulating the European financial system, while not disrupting the bank funding chan-nels and essential functions to the real economy A vital strategy of the

banking lobbies was that of anticipating and pandering to the reform

pro-cess to either prevent or water down at least the most burdensome sures The reform agenda brought to multiple patterns of competition among banks, depending both on the banks’ business models and then—

mea-as the sovereign crisis wmea-as exacerbated—on their being headquartered in surplus or deficit Member States The extent and direction of the corpo-rate influence are thus linked both to public issue salience and to the com-petitive cleavage set by the crisis

This study offers an innovative contribution to the academic and policy debates on the European banking regulation after the crisis from both a theoretical and empirical point of view Regarding the former, an original critical International Political Economy (IPE) approach is designed, which combines structural power, the collective agency of key socio-economic groups, and the public salience of regulatory issues as critical determinants

to explain corporate actors’ influence The structural level defines the dependence between corporate interests and public authorities in the con-text of national varieties of capitalism embedded in the European market for financial services Such a structure sets the terrain for the collective agency

inter-of conflicting socio- economic interests At this second level, the actors coalesce into organized interest groups and socio-economic coalitions, depending on the policy issues at stake, the lobbying resources, and the transnational and domestic actors’ policy entrepreneurship Lastly, the influ-ence of competing socio- economic groups is crucially affected by the politi-cal context, here understood as the degree of policy issue salience, shaping the EU decision-makers’ orientations in the financial regulatory process

An explanatory mechanism is thus hypothesized to assess the corporate influence capacity in “hard times,” linking structural factors and the coalition- making capabilities with the political salience of financial issues

in the different stages of the policy-making According to the hypothesis here tested, the increased public salience of banking regulatory issues threatens the established private-public regulatory relationships It offers a window of opportunity for a broader range of social interests to make their voice heard, and constrains corporate interests to align with the new pub-lic authorities’ concerns and goals During a high policy salience moment, corporate interests are incentivized to coalesce into broader and more inclusive interest coalitions if they want to rebuild their influence capaci-ties Such a coalition-building depends on structural factors (setting the grounding inter-sectoral and socio-economic cleavages) and the initiative

of critical corporate policy entrepreneurs, like the trade associations and

lobbying groups They must mediate among the different socio-economic interests involved to forge unitary policy demands and acceptable public narratives vis-à-vis the policy-makers.

The geographical and sectoral scope of the coalition shapes the patterns

of influence The broader the coalition-making capacity at the European level, the greater can be expected to be the influence over the EU-level policy-makers, together with the chances for weaker interest groups to get what is demanded in the reform outcomes On the contrary, the more the fragmentation across sectoral and geographical lines, the more will be the influence capacity for domestic corporate coalitions endowed with massive structural power resources in the European core economies In the latter case, domestic-oriented banking interests from core European economies are expected to retain more influence, if they manage to put their prefer-ences in terms of national interest to the eyes of the domestic authorities Conversely, when the public salience of regulatory issues is low, corporate interests have less need to mediate their preferences and can exert a stron-ger direct influence over the policy outcomes, depending on their struc-tural power resources As it will be shown, the interactions among corporate structural power, the interest groups’ coalition-making capaci-ties and the public issue salience, can help to explain the achievements and flaws of the European post-crisis banking governance, integrating the existing scholarly accounts

The explanatory framework is applied to a comprehensive historical analysis, tracing the Banking Union’s development within the broader context of the EU post-crisis initiatives in banking regulation An in-depth scrutiny of the interest groups’ preferences and influence is thus provided across the main pillars of the EU banking governance and throughout the whole reform cycle, from the aftermath of the financial crisis until the finalization of the capital requirements regulation, with the Banking Package in 2018 The stakeholders’ positions and patterns of influence will be analyzed in relation to the three policy-making stages here taken into account, together with the correspondent EU institutions playing the leading role in them: (1) the agenda-setting; (2) the formulation of the policy proposal (European Commission); and (3) the negotiations in the Council and the European Parliament leading to the final legislation During the agenda-setting and policy-definition stages of the EU policy- making process, interest groups strive to condition the very terms of a reform initiative In later negotiating stages, however, their potential influ-ence is limited to the (often crucial) details of the regulation or, at best,

directed at watering down the whole legislative proposal Thus, the issue salience and coalition-making capacities at the different policy-making stages heavily condition the corporate chances of success in the regulatory process The post-crisis reform agenda-setting in banking regulation and the subsequent Banking Union have been laid down in a high political salience environment, thus providing a crucial test bench to assess the behavior and lobbying strategies of a corporate community under stress.

STrucTure of The BookThe book is structured in two main parts The first part presents the theo-retical premises, the analytical framework and the overall competitiveness, lobbying and issue salience dynamics in the aftermath of the crisis In the second part, the analytical framework is applied to five case studies, cover-ing the main reform initiatives in the EU banking regulation, which have been linked to the Banking Union’s construction

Chapter 2 introduces an original critical IPE theoretical framework in the analysis of the EU financial regulation First, the chapter offers a review

of the literature on the EU post-crisis financial regulation and corporate influence, discussing its merits and shortcomings A critical transnational-ist approach is thus outlined, built on the Neo-Gramscian literature in IPE. Structure and agency both shape the emergence of conflicting trans-national coalitions of socio-economic interest groups and policy-makers Structural determinants, lobbying resources, and political factors are linked together in a three-tier analytical framework to assess the leading public-private coalitions and their influence capabilities at the EU level.Chapter 3 offers an overview of the European banking industry between the global financial turmoil and the sovereign debt crisis outburst It pro-vides the essential coordinates for analyzing the case studies, by elucidat-ing the overall industry’s structural conditions, competitive patterns, and lobbying resources, together with the public salience of banking issues.Opening the second part, the first case study of Chap 4 deals with the reform of banking supervision in the EU, from the creation of the European Banking Authority (EBA) up to the implementation of the Single Supervisory Mechanism (SSM) It is argued here that the European cross-border banks rode the wave of the post-crisis reform agenda to push for a supranationalized framework in banking supervision, as their long- standing demand

Chapter 5 analyzes the creation of the EU crisis management work with the Bank Recovery and Resolution Directive (BRRD) and the ensuing establishment of the Single Resolution Mechanism and Fund (SRM and SRF) Contrary to the Banking Union’s initial project, it soon appeared clear that the SSM would not represent the very premise for a common backstop and burden-sharing arrangement capable of reaching the ambitious aim to break the bank-sovereign doom loop A crisis man-agement model based on the bail-in principle and the prevention of moral hazard soon emerged as truly second pillar of the Banking Union, meeting the demands of the banks headquartered in the Eurozone potential credi-tor countries as well as the interests of cross-border banks.

frame-Linked to the introduction of a common backstop, the harmonization

of the deposit guarantee schemes and the plans for a pan-European deposit insurance system are analyzed in Chap 6 In this case, the diverging banks’ risk profiles and deposit guarantee models along domestic lines structur-ally prevented the European banking industry from speaking with one voice The European banking industry, including the cross-border banks, fragmented along domestic lines and aligned with respective governments Thus, compact domestic public-private coalitions emerged, exacerbating the debate’s polarization along the core-periphery divide and the endur-ing deadlock in the negotiations

Chapter 7 traces the banking industry’s role in the reform of the EU’s prudential requirements, as the basis of a Single European Rulebook for banks underpinning the Banking Union It covers from the post-crisis Regulation and Directive on capital requirements (CRR and CRD IV, in 2013), up to their recent revisions under the “Banking Package” (the CRR 2 and CRD V, in 2018) The European banking industry united the efforts to water down the introduction of harsher rules, framing their opposition by pointing at the supposedly consequential reduction in lend-ing to the business sectors A competitive cleavage emerged between internationalized and domestic-oriented banks around the extent of the harmonization Under a high political salience, the banking industry was defeated in several key demands, with significant capital and liquidity bur-dens in the new framework However, cross-border banks obtained a highly harmonized framework, through the choice of a Regulation as the legal instrument Large and smaller European banks managed to water down, postpone, and shift some of the opposed provisions as supervisory tools for the competent authorities, to be imposed on case-by-case situations

Chapter 8 focuses on the reform on the separation of deposit-taking from variously trading-related activities The reform project questioned a grounding pillar of the modern ‘market-based’ banking system, represent-ing a fundamental threat to the European financial industry Moreover, the issue attracted a relevant degree of salience in the European public opinion and mobilization from Civil Society groups, soon becoming a sensible question for both the national and European policy-makers On

the other hand, the competitive threats resulting from such a proposal

united the European banking industry into a compact and proactive bying coalition The prolonged stalemate in the negotiations and the decline in issue salience allowed the banking industry to obtain its major success, with the final withdrawal of the proposal in 2018

lob-The final chapter summarizes the book’s main findings and outlines the general approach in banking regulation emerging from the post-crisis reform process The overall architecture and final provisions of the Banking Union’s pillars here scrutinized reflect a mediation between the core demands of European transnational banks and the German/Northern bloc of domestic banks Rather than narrowing the scope of financial mar-kets’ expansion, such a regulatory framework sets the conditions for a new round of competition at the EU level, through a new level playing field mainly shaped by cross-border institutions, mediating with domestic- oriented banks in the core EU countries

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G Montalbano, Competing Interest Groups and Lobbying in the

Construction of the European Banking Union,

https://doi.org/10.1007/978-3-030-65425-2_2

A Critical Transnationalist Approach

to the European Financial Governance

Untangling the knot of the relationships between politics and the omy, States and markets, public authorities and private actors is a funda-mental premise to understand the nature of power in the international arena Such a task proves particularly challenging in a uniquely complex and hybrid supranational polity like the EU. The scope, conditions, and forms of corporate power in the EU policy-making represent a paramount issue to assess the whole process of European integration and its limits and prospects Such an underlying problem is recognized and addressed—through different lenses—from the competing theoretical approaches in European integration and financial governance The same variety of per-spectives informed the burgeoning literature and continuing debates on the EU post-crisis banking regulation and the Banking Union Although these works already provided comprehensive accounts and in-depth case studies regarding the European banking governance after the crisis, some fundamental pieces still lack, which are nonetheless relevant to reconstruct the overall mosaic

econ-In particular, as argued here, a focus on the banking industry and its influence throughout the reform process is needed to fill the gaps in the story To this aim, a distinctive theoretical approach is elaborated here, which intends to overcome the shortcomings and one-sided views on cor-porate power underlying the prevailing theories and scholarly strands While directed at explaining the EU reform of banking regulation, the

approach here proposed seeks to provide a comprehensive critical retical framework for the analysis of European integration and global governance.

theo-This chapter has three aims and corresponding sections First, it cally reviews the theoretical approaches in European integration and the post-crisis financial reform that are most relevant to the case, by highlight-ing their merits and drawbacks Then, taking the cue from the literature’s flaws, the second part introduces a critical transnationalist approach to deal with the structural, instrumental, and political power dimensions across the domestic/supranational levels Structural determinants, lobby-ing capacities, and political factors are linked together in a three-tier ana-lytical framework to assess the leading public-private coalitions and their influence capabilities at the EU level Lastly, the research design of this study is elaborated from the tenets of the theoretical approach The latter

criti-is thus translated into specific explanatory hypotheses and determinants to

be tested in the selected case studies and then provide a comprehensive account of the EU banking governance after the crisis

Beyond the domestic/supranational dichotomy

in the european integration theory

The growing scholarly literature on the EU post-crisis financial nance variously relates to the main theoretical approaches in the European integration studies Intergovernmentalist and supranationalist views are the leading traditional contenders in the field (Schimmelfennig and Rittberger 2006: 76) A limitation of both the grand theoretical traditions

gover-in the European studies rests gover-in the assumption of a tional dichotomy, leading to partial accounts of the relationships between socio-economic interests and policy-makers States and supranational actors are alternatively identified as the real drivers of European integra-tion As argued here, the latter is a problematic and unfruitful opposition that can be overcome by focusing on the socio-economic structures and actors underlying the power asymmetries, conflicts, and compromises among the European decision-makers

national/suprana-Realist intergovernmentalism was already well aware of the centrality of incumbent social and economic interests in shaping the States’ foreign policy goals in the history of European construction (Hoffmann 1982: 26–29; 2019 [1995]; Grieco 1996; Milward 2000) However, only with

the development of its liberal version, the intergovernmentalist approach started to open the “black box” of national preference formation Thus, liberal intergovernmentalism looks at the distributional conflicts and sector- specific interests of powerful domestic socio-economic groups as a crucial determinant in the formation of the State interests (Moravcsik 1993: 481; 1997: 538–541; 1998: 18, 38; Moravcsik and Schimmelfennig 2009: 69–70) However, the rationalist framework underpinning Moravcsik’s theorization reduces the government as a unitary aggregator

of majoritarian sectoral societal inputs Interest groups and social demands

are thus treated as mere providers of domestic policy inputs to be

pro-cessed by a State machine whose relative geopolitical/economic power determines their successful upload in the EU agreements and legislation The conditions empowering certain socio-economic groups and the policy- makers’ selective responsiveness remain outside the scope of liberal intergovernmentalism This view overly exemplifies the social and political dynamics underlying the European integration process (Bieler and Morton 2001: 15–17; Van Apeldoorn et  al 2003: 25; Ryner and Cafruny 2017: 18–23)

Overcoming Moravcsik’s “unnecessarily reductive notion of domestic politics” is one of the distinctive objectives of the “new intergovernmen-talist” approach, designed as a refinement of intergovernmentalism in light of the historical path of European integration after the Maastricht Treaty The proponents of this new version of intergovernmentalism thus defend an in-depth focus on the preference formation process New inter-governmentalism thus takes into account the end of the “permissive con-sensus” in European politics, the role of contestation movements, and—in general—the patterns of state-society relationships and institutionalization (Bickerton et al 2015a, ; Puetter 2014) As noticed in critical reviews, however, the new intergovernmentalists “do not spell out a view of how state-society relations are to be understood” (Bulmer 2015: 296) Thus, the politicization of the European policy issues is not explained (Schimmelfennig 2015b: 727–8) and the role of non-State actors is over-looked (Baird 2017)

Both “old” and “new” intergovernmentalisms thus fall short in ing a theorization of the State preference formation capable of accounting for relationships between conflicting socio-economic demands and politi-cal élite interests within the EU multilevel polity Such a view crucially neglects the coalition-making capabilities and venue-shopping strategies

provid-of cross-border actors forging transnational coalitions to exploit

legitimacy-input demands and conflicts among relevant domestic, national, and international regulatory authorities The inter-State power asymmetries are then isolated from power asymmetries among transna-

supra-tional socio-economic interests within a supranasupra-tionalized polity,

like the EU

State-centrist assumptions inform as well, together with its drawbacks, the domestic-centered approaches in European financial integration Incumbent domestic financial interests and the related institutional fea-tures of national financial systems have been thus protagonists of a “bat-tle” over the integration of the European capital markets, whose outcome was determined by the relative States’ power (Story and Walter 1997: 275–81) The European countries hosting the large financial centers—notably the UK, Germany, and France—and the US have been identified

as true Master of Financial globalization (Kapstein 1994; Helleiner 1996; Drezner 2008) In particular, the German and British financial systems have been taken as theoretical references for two dominant and contrast-ing varieties of credit supply: the European Continental banking-based model and the Anglo-Saxon capital market-based one, toward which the former tend to converge (Zysman 1983; Allen and Gale 2000: 4–5; Deeg

1999, 2010: 311–12) The ideal-typical dichotomy in financial nance mirrors the general opposition between coordinated and liberal market economies in the Varieties of Capitalism (VoC) literature, referred

gover-to two equilibria for the firms’ coordination problems in their institutional environment: the former based on non-market strategic interactions between private and public actors, and the latter grounded on the con-trary in market-driven contractual relations (Hall and Soskice 2001: 8–9; 2003; Hall and Gingerich 2004; Hancké 2009: 2; Hall and Thelen 2009: 8) Such a framework reduces the conflicts among different patterns of capitalism in reified binary terms, while it overshadows the overlap and hybridization of both market-liberal and bank-coordinated elements in the process of European financial markets’ integration (Hay 2005; Pontusson 2005; Hancké et  al 2009: 277; Macartney 2011: 455–58) Putting into question the same distinction between competing market- and bank-based models, Hardie and Howarth highlighted the centrality of

a “market-based” business strategy and corporate governance in the European bank lending before the global financial crisis (Hardie and Howarth 2013: 24–27)

Focusing on the entrenched regulatory philosophies at the domestic authorities’ level, Quaglia counterposed a British-led “market-making”

(principle-based) to a German-led “market-shaping” (rule-based) cacy coalition in the construction of the single market of financial services (Quaglia 2010a: 1010–12; 2010b: 11–23) While the pre-crisis decade saw a predominance of the Anglo-Saxon “market-making” coalition of States in the European regulation, a Continental “market-shaping” coali-tion rose in the making of the reform agenda after the global financial crisis (Quaglia 2012: 530) Such an adaptation of the advocacy-coalition framework (Sabatier 1998) shed light on the long-standing systems of beliefs shared among domestic authorities However, it falls short in accounting for the overlapping of the two regulatory approaches in con-crete reform initiatives, as well as for changes in the composition of the respective coalitions and the same regulatory ideas underpinning them As Quaglia well recognized, such an “account suffers somewhat from meth-odological nationalism in that it presents an oversimplified version of countries positions, whereas states are not monolithic actors” (Quaglia 2012: 526) In her empirical analyses, the same author showed well how

advo-UK, Germany, and France adopted both “market-making” and “market- shaping” strategies to defend the respective domestic financial interests before and after the global financial crisis

Focusing on the societal conditions of State preference formation, domestic-centered approaches thus generally treat corporate groups as providing the contents of the governments’ positions Nevertheless, their changing interests, conditions of empowerment, and lobbying strategies beyond the domestic borders are substantively neglected (Schirm 2009,

2018, 2019) Thus, although providing relevant empirical contributions, intergovernmentalist studies in the post-crisis European financial integra-tion similarly focused on coherent domestic blocs of State and interest groups, thus neglecting the relevance of the transnational industry and supranational policy-makers (Westrup 2007; Quaglia 2008a, ; Hennessy 2014; Spendzharova 2012; Perez and Westrup 2010; Schirm 2011, 2013; Maris and Sklias 2016) Even here, the limits of the domestic-centered framework come to the surface in the empirical analysis For example, from a “systemic-realist” perspective, Buckley and Howarth focused on the dominant financial powers and their incumbent banking interests in their struggle to “to upload their model to the EU and international levels

to gain and preserve comparative advantages” (Buckley and Howarth 2010: 121; Zimmermann 2010; Buckley et al 2012: 113) However, the same authors partly enlarged their visual and showed the continuing lob-bying capacity at the transnational level of the European financial industry

in the case of the EU regulation of hedge and private equity funds, the Alternative Investment Fund Managers Directive (AIFMD) (Buckley and Howarth 2011: 140–41) Thus, it is not clear why—according to these perspectives—in some cases, an inter-State logic of power prevails, while the lobbying capacity of a transnational industry coalition takes center stage in other cases, even re-empowering the City of London in the after-math of the crisis Did the conflicts and mediations within the European financial industry, at both geographical and sectoral levels, matter and to what extent? The intergovernmentalist literature leaves us with no answers

to this question

In the same fashion, State-centered accounts of the European Banking Union and its main pillars focus on the divergent interests and power asymmetries among core EU Member States, as reflecting their domestic banking systems and market incumbents (Howarth and Quaglia 2013,

2014, 2015, 2016a, b 2017; Gren et al 2015; Donnelly 2014, 2016, 2018a, ; Deeg and Donnelly 2016; Spendzharova 2014; Schimmelfennig 2015a; Lombardi and Moschella 2016) These contributions shed light

on the conflicting EU States’ preferences, goals, and achievements that led

to the European Banking Union’s (EBU’s) suboptimal outcomes and its incomplete institutional setting However, such approaches face more dif-ficulties in explaining the emergence of the EBU agenda and the (even partial) transfer of substantive powers at a supranational EU level, seem-ingly running against the initial interests of core creditor countries, like Germany

Well aware of such difficulties, Howarth and Quaglia offered the most comprehensive account of the State interests and outcomes of the EBU,

by originally combining the intergovernmental perspective with alist arguments (Howarth and Quaglia 2016a: 14–15; for a similar synthe-sis of approaches, see Quaglia and Spendzharova 2017) In particular, the rationale of the EBU is explained with the recourse to Schoenmaker’s financial trilemma According to the latter, it would be impossible to hold simultaneously financial stability, cross-border banking, and national financial supervision Any two of the three objectives can be combined, but not all three (Howarth and Quaglia 2016a: 17; Schoenmaker 2011, 2013: 6–7) The functional pressures unleashed by the extent of the European banking integration and the failures in coordination among national supervisors in the monetary Union constituted an “inconsistent quartet” (Howarth and Quaglia 2014: 126; 2016a: 19–20) that pushed for the supranationalization of banking regulation The latter met the

function-resistances and diverging interests of core European powers, rooted in the configuration of the respective national financial systems, bringing to a fundamentally intergovernmental profile of the EBU (Howarth and Quaglia 2015, 2016a: 21–23) Although the authors episodically include the Commission’s positions, the European Central Bank (ECB), and cross-border banks, the role of such actors falls outside the lens of their theoretical approach Thus, the relative influence of conflicting socio- economic interests’ coalitions vis-à-vis national and supranational authori-ties is neglected The societal dimension, however, is relevant to assess if and how the functional pressures translated into the preference formation and empowerment of those domestic/EU-wide interest groups vis-à-vis the European policy-makers.

Differently, from a “realist-institutionalist” approach, Donnelly prets the EBU as a crucial element in a post-crisis European economic governance mirroring the dominance of Germany and its strategic inter-ests (Donnelly 2018a) The EBU would represent a pivotal episode in the post-crisis process of “Germanisation” of Europe (Beck 2013) Thus, the EBU reflected Germany’s preferences as the great European power, rather than restraining them, thus bringing to a lacking institutional structure that cannot ensure financial stability (Donnelly 2018a: 180, 184–186) However, such a realist view fails to account for the mediations and con-cessions by the German government, like in the case of the Single Supervisory Mechanism, as the same author acknowledges (Donnelly 2018a: 130–31) While taking Germany as the pivotal country, liberal intergovernmentalist accounts pointed at the divisions within the German domestic interests to explain its need to compromise (Howarth and Quaglia 2016a: 22–23) Caught between the call of preserving the exis-tence of the Economic and Monetary Union (EMU) and the fears of being the major net contributor of a “transfer Union” at its taxpayers’ expense, Germany found itself in the position of a “reluctant hegemon” in the EU post-crisis economic governance (Paterson 2011; Bulmer and Paterson 2013; Bulmer 2014; Schweiger 2015; Dyson 2015) However,

inter-in order to better assess the extent and contents of the “hegemonic” tion exerted by Germany, its domestic interests need to be also framed in the broader context of European-level conflicts between corporate and non-corporate actors, pointing at the socio-economic content of hege-mony (Montalbano 2020) Moreover, the relationships between cross- border German corporate interests and the European supranational

func-policy-making institutions, and their conflicts with the German ment, are overlooked in such a domestic-centered view.

govern-In their different variants and combinations, intergovernmentalist approaches in the EU politics show fundamental limitations in their accounts of the European post-crisis financial governance These short-comings are rooted in their restricted focus on domestic interest groups and related patterns of influence, overlooking the transnational dimension

of corporate agency and public-private relationships

Conversely, supranationalist accounts treat the European-level decision- makers and interest groups as the key agents in the integration process In the neofunctionalist theory, for example, the Commission is the critical collector of the societal demands for cross-border markets integration, harnessing them toward the expansion and deepening of European coop-eration Transnational-oriented interests are thus reduced to the material

“vehicles” of the functional spill-over pressures and “transaction costs” which fuel the integration engine (Haas 1958: ch 8; Sandholtz and Zysman 1989: 113–119; Niemann and Schmitter 2009: 49–50) A similar reductionism occurs in the subsequent theoretical refinements of neo- functionalism (Stone Sweet and Sandholtz 1998; Stone Sweet et al 2001) According to Stone Sweet and Sandholtz, the emerging “transnational society” of market actors constituted the main driving force in Europe’s institutionalization, in a process that gradually reduced the control of the Member States’ governments (Stone Sweet and Sandholtz 1998: 4–5, 11–15) Increasing “transnational exchanges” are thus taken as the explan-atory variable of the institutionalization of the European space In this way, this perspective neglects the concrete interests, coalitions, and ideas underlying conflicting visions of the European integration by the transna-tional actors (Fliegstein and Stone Sweet 2001: 34–36; Stone Sweet et al 2001: 18–20) Departing from the functionalist assumptions, historical institutionalists looked at path-dependence dynamics According to the latter, established institutions produce positive feedbacks triggering either their conservation or cumulative changes, even unleashing outcomes unintended by their creators and/or principals (Pierson 1996, 2004; Stone Sweet et al 2001) However, such a reliance on the spill-over and path-dependence mechanisms move to the background the agency of con-flicting transnational and domestic economic actors, which are assumed to

be the first driving forces of the EU decision-making (van Apeldoorn et al 2003: 22–26)

Distancing themselves from the so often criticized automatism of the spill-over mechanism, revised versions of the neofunctionalist theory maintain a developmental logic in which the agency of the transnational actors is obscured, together with the power relationships among private and public interests While including the relevance of interest groups in the theoretical approach, neofunctionalist- and institutionalist-like accounts of the European economic and monetary integration treated transnational corporate groups as material inputs gathered and steered by European policy-makers and experts to deepen supranationalization (Mutimer 1989; Tranholm-Mikkelsen 1991; Corbey 1995) In his neo-

neo- functionalism, Schmitter conceptualizes the possibility of strategic

responses different from spill-over are acknowledged, even in the form of

a disintegrative “spill-back.” In the end, however, the functional pressures unleashed from regional-level rules are taken as the driving forces of Europeanization “to the point that they begin to overshadow the opinions and actions of national governments, associations and individuals” (Schmitter 1970: 850–55; 2004: 26) Similarly, in her work, Niemann breaks with the cumulative assumptions of neo-functionalism, by focusing

on the relationships between spill-over/spill-back mechanisms and the actors’ agency (Niemann 2006: 24–26, 30–31) Therefore, the functional spill-over is deemed to require the agents’ perceptions of the “plausible” and “compelling” character of those same functional pressures in order to act upon them (Niemann 2006: 31) A lacking conceptualization of power characterizes, at the same time, the subsequent forms of political, social, and cultivated spill-over identified by the author (Niemann 2006: 36–37, 39–42, 43–44)

Looking at the construction of the EMU and Single Market in Financial Services, in their works Posner and Jabko highlight the entrepreneurship

of the Commission in shaping the same industry associations and related market ideas as its proper Europeanized constituency in the making of the Single European market for financial services (Posner 2005, 2009; Jabko 2006) Although these studies fruitfully shed light on the Commission’s policy entrepreneurship in decisive moments of the European integration, they assume a rather passive role by socio-economic organized interests, overlooking the possibility of their proactive role in the agenda-setting and policy-making process Moreover, by treating cross-border interests as the Commission’s proper constituency, these approaches neglect their continuing need to build alliances with core EU Member States’ govern-ments as crucial agents

Along this supranationalist stream, the post-crisis European economic governance has been read as a case for neo-functionalism and historical institutionalism According to the former, the Commission exploited the

“functional dissonances” in the lacking EMU design that emerged after the crisis to foster a far-reaching reform agenda and to expand its powers over the Member States (Niemann and Ioannou 2015; Gocaj and Meunier 2013; Schimmelfennig 2014; Vilpišauskas 2013)

In line with functionalist arguments, the EBU has been explained as a result of the policy entrepreneurship of the Commission and the ECB, overcoming Member States’ initial oppositions (De Rynck 2016; Schimmelfennig 2016; Epstein and Rhodes 2016a; McPhilemy 2016; Glöckler et  al 2017; Epstein 2017: ch 5; Nielsen and Smeets 2018) Unlike the intergovernmentalist works, these accounts unveil fundamental dynamics underlying the EBU agenda-setting, the ceding of authority by core Eurozone Member States over their banks, and the ensuing concen-tration of supervisory and crisis management powers at the supranational level On the flip side, they either ignore or far less useful in explaining the lacking pillars and incomplete achievements of the EBU Moreover, most

of these accounts either neglect or explicitly negate a significant role to the European banks and other interest groups in the making of the EBU. For example, De Rynck argues that “banking has retrenched to national mar-kets since 2008 and lobbying by cross-border banks in 2012 was not dif-ferent from earlier years” (De Rynck 2016: 120) However, he does not provide evidence for this claim A noticeable exception is represented by the contributions of Epstein and Rhodes, which focused more on the dynamics of “shifting loyalties” between cross-border banks and the home states According to two scholars, the EBU represented a kind of consen-sual divorce between national banking champions and their respective government authorities, due to the fragmentation of the European finan-cial markets and the conflicts among national authorities in the cross- border entities’ supervision from the global financial turmoil up to the sovereign debt crisis Putting to an end the historical symbiotic relation-ship with State power, the transnational banks then strategically became the key social allies of the Commission and the ECB in the construction of the EBU (Epstein and Rhodes 2014: 13–15; 2016a: 431; 2016b; 2016c: 100; Epstein 2017: 150–52) Nevertheless, the authors did not scrutinize what they elsewhere call the “micro-level processes” (Epstein and Rhodes 2016a: 417) of such a historic severing of the ties between States and large banks: that is, the specific interests, lobbying strategies, coalition-building,

and influence of these actors in the agenda-setting and policy-making phases of the reform of financial supervision in the EU from 2009 to the EBU. Therefore, the alliance between cross-border interests and suprana-tional EU institutions pushing for a full-fledged Banking Union is mostly assumed rather than proved systematically.

Lastly, some constructivist-inspired studies went as far as explaining the post-crisis European financial governance as a result of ideational capture

by a German-led ordo-liberalism (Young 2014; Matthijs 2016; Nedergaard and Snaith 2015; Nedergaard 2018) According to Schäfer, for example, the ordo-liberal concept of severing the sovereign-bank links has been exploited strategically by the Commission and the Southern Member States Hence, they compelled the German government to accept it: “the need for argumentative consistency made it vulnerable to demands for further mutualization” (Schäfer 2016: 962) However, it is not clear how such an “argumentative consistency” could have shaped as such the Merkel government’s preferences, irrespective of any consideration to the interests of its domestic social and economic constituencies Nor can it explain why the German government opposed the direct supervision of its small banks, as well as the institution of a full-fledged backstop mecha-nism By reducing power relationships and conflicts to the discursive sphere, such constructivist approaches systematically neglect the material bearers of economic ideas, together with the vested interests underpinning them On the contrary, other scholars noticed the “pragmatic” adaptation

of the German government’s ordo-liberalism ideas in the euro-crisis (Feld

et al 2015; Beck and Kotz 2017) However, little attention has been cated to the socio-economic basis of the competing economic policy ideas

dedi-at play in the EU post-crisis reform and their strdedi-ategic uses by competing groups to win the policy-makers’ consensus

In sum, State-centered and supranationalist approaches—in their ferent theoretical versions—generally assume the theoretical relevance of domestic/cross-border interest groups’ role, while failing to conceptual-ize their agency and forms of public-private relationships in the multilevel governance framework of the EU. Similarly, eclectic accounts combining intergovernmentalist and neofunctionalist arguments looked at the inter-actions between core Member States and supranational institutions, excluding from their analytical framework the agency of organized inter-ests both at the national and European levels (Verdun 2002; Wolf 2002; Heipertz and Verdun 2010; Krampf 2014)