The Memorandum of Understanding constitutes part of the efforts to develop EU arrangements for financial stability and to enhance the cooperation between relevant authorities, and is the result of the agreements reached by the ECOFIN Council in October 2006 and October 2007. The objective of the MoU is to deepen the cooperation between the authorities that need to be involved in the management and resolution of a financial crisis, namely: the Financial Supervisory Authorities, the Central Banks and the Finance Ministries of the EU. The Memorandum commits all signatories to cooperate across borders between relevant authorities, both in normal times, in order to ensure preparedness for the management of a potential cross-border crisis situation, and in crisis situations. The MoU entered into force on 1 June 2008 after it had been signed by all 118 signatories from 27 EU Member States and the ECB. It replaces the previous Memorandum concluded in 2005.
In the context of Iceland, Liechtenstein and Norway signing up to the Memorandum of Understanding, the Memorandum expanded by the new signatories came into effect as of 10 June 2010.