On Tuesday 15 April 2014, the EU's four year drive to create a banking  reached a climax with the passing of a series of reforms so voluminous that the day was compared to Super Tuesday (the decisive day of voting in the US presidential primary calendar). The impact of the legislation has been described as "seismic".

What are the reforms?

The idea behind the banking is to provide common rules and protections across the Eurozone to make banks safer and more transparent, and to lift the burden of bank bailouts from taxpayers' shoulders. The need for this became particularly apparent following the turmoil of the financial crisis when, for example, the Eurozone bank bailouts in the Republic of Ireland and Greece came at a great cost to the ordinary tax payer.

The rules passed on 15 April together with previous legislation create a 'Single Supervisory Mechanism' to ensure that governments are no longer the sole masters of their national banks. Rather, the European Central Bank (ECB) will monitor the health of and police the risks taken by all major banks within the Eurozone (but not the UK). In the event that a bank gets into trouble, the ECB will have the power to intervene, even against the wishes of the bank's home state.

The process of rescuing a failing bank or, in the worst case, letting it go bust, will be managed by the 'Single Resolution Mechanism'. The costs of a bailout will be absorbed by a bank-financed €55 bn single resolution fund, to be established gradually over 8 years. This means that bank owners and creditors will be first in line to pay the bank's losses. To the extent that taxpayer money is needed to absorb losses in addition to this, it will be provided by Eurozone governments collectively.

Further, a deposit guarantee scheme requires EU countries to set up their own bank-financed schemes to guarantee deposits under €100,000 in the event that the bank is not able to do so itself.

Alongside the legislation relating to the banking , reform of EU capital markets was introduced. The Markets in Financial Instruments Directive (Mifid) contains more stringent rules for trading commodities, over-the-counter derivatives and high-frequency trading (HFT) in an attempt to deal with superfast technologies that allow traders to seek the advantage of fractions of seconds when buying and selling assets.

Will they work?

Critics have argued that the reforms are under-funded and overly complicated. Although the main legislation has been passed, regulators must still thrash out the detail of roughly 400 further technical standards and guidelines to actually implement the reforms. This is a mammoth undertaking both in terms of volume and difficulty. Many of the laws that were passed are deliberately ambiguous as a result of political pressures and compromises, and implementing these will undoubtedly be challenging.

Arguably however, even if a full framework is implemented, the ultimate key to successful reform and financial stability lies in the attitude of banks. Monique Goyens, director general of the European Consumer Organisation, has commented that "The changes must be matched with real willingness by the financial sector to learn from the crisis...Any attempt to clean up the financial sector's malpractices will fail when the roulette with people's money is allowed to continue."