There was a real fear that a euro-zone bank might fail, that we’d have a sovereign debt problem in one of the larger European economies. That’s dissipated, thanks largely to the action of the European Central Bank.

Osborne is reflecting on the acute phase of the eurozone crisis, when markets feared a cascading failure: a major bank collapse could have forced governments to assume liabilities, pushing a large euro-area state into a sovereign-debt spiral. He argues that this tail-risk receded primarily because the European Central Bank acted as a credible backstop—signaling willingness to provide liquidity and, if necessary, intervene in sovereign-bond markets. The remark underscores a key lesson of the crisis: confidence can hinge on institutional capacity and clear commitments, and central-bank action can stabilize expectations even before large-scale purchases occur.