European Monetary Union and a vigorous legislative agenda have profoundly
changed the environment in which the European financial services industry
operates. These developments should have contributed to a deepening of
financial market integration in the European Union, especially within the
Eurozone. However, actual progress has been very uneven. Eurozone money
markets and bonds markets have achieved full or a very high level of integration.
Eurozone equity markets show increasing signs of integration, although
substantial barriers to cross-border trading remain. Bank credit markets, with the
exception of inter-bank lending, and insurance and funds industries, remain still
largely fragmented along national lines.