The relationship between the banking sector and the public finances is a complex one. First, government ownership of banks is prevalent, and rising on account of the crisis. Second, the behavior of private banks may be influenced by politics, for instance if politicians sit on the boards of banks. Third, the financial safety net is backstopped by national treasuries so that a banking crisis entails potentially huge fiscal costs. Fourth, banks are subject to taxation, and potentially constitute a major source of tax revenues. Fifth, government debt is a key asset category of banks, so that a government debt crisis can cause widespread bank distress. Going forward, a key question is how the relation between the banking sector and the public finances can be reconfigured to bring back financial stability, including government finance stability.