The ECB’s annual report on financial integration in Europe contributes to the advancement of the European financial integration process by analyzing its development and the related policies. The Euro system has a keen interest in the integration and efficient functioning of the financial system in Europe, especially in the euro area, as reflected in the Euro system’s mission statement. Financial integration fosters a smooth and balanced transmission of monetary policy throughout the euro area. In addition, it is relevant for financial stability and is among the reasons behind the Euro system’s task of promoting well-functioning payment systems. Without prejudice to price stability, the Euro system also supports the objective of completing the EU Single Market, of which financial integration is a key aspect. In September 2005 the ECB published a first set of indicators of financial integration and an accompanying report assessing the state of euro area financial integration. Since then the work on financial integration has evolved and has resulted in the publication of a yearly report.