‘The corona crisis could have been much worse’
The banking system was in dire need of an overhaul; that much was clear from the credit crisis in 2008. The EU has made significant changes since. PhD candidate Barbora Budinská is researching the legal validity of the new supervisory mechanism for banks.
This article previously appeared in Leidraad, Leiden University’s free alumni magazine. Read the full magazine online.
Why do we obey one rule rather than the other? It was her interest in human behaviour that led Barbora Budinská (31) to study law. Although this is also a focus of sociology and psychology, it was law that intrigued her most. ‘And that intuitive decision was justified,’ laughs the Slovakian, who is two years into her PhD research at Leiden Law School.
Childhood in Slovakia
Budinská grew up in a small town in Slovakia that had always had a large German-speaking community. It was the ‘natural decision’ to go to a bilingual school and learn German. Studying in Berlin was the obvious choice too. ‘The law degree in Berlin focused on German law, German culture and German history,’ says Budinská. ‘Whichever country you study law in, you always begin with national law. But European legislation has so much impact on the national systems that you have to know more about that too. I think it is essential that lawyers in EU countries have some understanding of European law. Otherwise you can’t do your work properly.’
The focus on Europe probably dates back to Budinská’s teenage years. ‘Slovakia joined the EU in 2004,’ she explains. ‘A door that hadn’t been open for the older generation suddenly opened for the younger one. I realised there was an international community right on my doorstep and that I myself was part of it.’
‘European law is fascinating’
International relations were already a fervent interest of Budinská’s, but the focus gradually shifted to Europe. ‘European law is fascinating because so much happens. You’re right in the midst of things, whether you want to be or not,’ she says. ‘For example, many people know nothing about the existence of the European banking union, let alone that this works well. The corona crisis would have been much worse without it. Our banks have become more resilient and now have bigger buffers that they can use in times of crisis.’
What is the European banking union?
The European banking union was set up in 2014 to ensure that commercial banks within the EU are better supervised. Before its inception, the responsibility for supervision lay with national central banks and other authorities: De Nederlandsche Bank supervises ABN Amro, Rabobank, ING and so on. However, this wasn’t working as it should, something that became all too clear during the 2008 credit crisis. To prevent the disintegration of the eurozone and countries from returning to their former currency, the supervision of commercial banks was ‘Europeanised’. Banks are now more financially healthy and the risks for savers and taxpayers have been reduced.
All sorts of legal questions
The improvement to the banking system is mainly thanks to the supervision of commercial banks by the European Central Bank (ECB) instead of national supervisory bodies. ‘For the first time in history a European institution, the ECB, has to implement national rather than European law. This entirely new situation raises all sorts of legal questions. One of my research questions is how the European Court of Justice can verify the legality of ECB decisions that are based on the different national laws of 19 eurozone countries. In short, legal research can help improve the working of the European banking union.’
Interaction with students
Budinská combines her research with teaching law students in Leiden, something that she throws herself into. ‘You need lecturers to make law interesting to study. It makes a world of difference if your lecturer wants to share her own research, talks about the problems she has encountered and explains why certain topics are so complicated.’
The interaction with students is important to Budinská. ‘I try above all to help my students form a well-founded opinion, also about Europe. I believe that the EU has enormous potential to improve our lives. And although that has happened to some extent, there is still room for improvement. That’s why you have to remain critical. If I can contribute to important discussions in the world by helping my students hone their opinions, then I have achieved my goal.’
Text: Wilke Martens
Photo: Taco van der Eb