The economic crisis is a major hindrance to development in any Country. After the United States experience significant financial instability due to the debt crisis, the EU had to take strong action to save its financial market by strategising and analysing the market trend. The budgetary emergency featured the requirement for better control and supervision of financial statements. These tenets are the essential structure for each of the 28 Member States of the EU and support a legitimately working single market for money related administrations (Lane, P. 2012). The resulting Eurozone emergency included an additional measurement. It featured the possibly endless loop among banks and sovereigns. The requirement for a superior represented and more profound financial and money related association for only cash to work over the long haul turned out to be clear. Specifically for nations which share the same currency, a more profound increasingly incorporated methodology is vital – fundamentally guaranteeing concentrated conveyance of the principles for each of the 28 Member States (But & Carnot, 2012).

The European Union Parliament passed measures to ensure excellent management of the financial system. As per Nugent (2017), new regulations were proposed to regulate loans and mortgage issued by Banks and other financial institutions. Better procedures that enhance Union supervision through relevant organs were a significant milestone taken by the EU Council. In 2011 EU parliament seating, the members agreed to form European supervisory authorities with the task of ensuring there is transparency and legal actions are in place to manage to borrow (Olsson, S. 2009). The European Banking Authority (EBA) helped in ensuring that Bank supervision of the European Nations is supervised and also coordinating recapitalisation of banks and other financial institutions. The European Security and Market Authority (ESMA) another agency deal with monitoring the capital markets and oversee credit rating agencies together with the trade. Insurance supervisions of the financial institutions made by the European Insurance and Occupational Pension Authority (EIOPA); all these efforts were made in line to ensure the Union does not sink into deep debt crisis (Eichengreen, B. 2012).

According to Sharma (2013), the European Union Council adopted new rules and regulation to handle crisis management in 2014. The Laws protect banks deposits and ensure those specific guidelines taken when issuing mortgages. The issue of over borrowing is dangerous for bank operations since the banks may run out of finance. The directive of the EU was that Banks to supervise loan issuing by ensuring there are faster pay-outs together with shorter repayment period (Liikanen, E. 2012). The need to have a banking union is to enable easily traceable of the creditors and debtor’s transaction hence removing any illegal activity that might have took place. The adoption of the Capital Requirement Directive (CRD) and the Single Supervisory Mechanism (SSM) pillars also helped

To conclude, it’s evident that the European Union responded adequately to the debt crisis. The same disasters that happen in the United States were a reference point to the Union to take firm action to secure its financial market and the currency depreciating. The European Council made a critical decision by forming agencies that will regulate backs and oversee the borrowing and leading process. Adopting key pillars was another milestone in ensuring the European bloc has a progress economic growth.