"For countries that are part of the single market and that also share a single currency, as in the euro area, it is clear that a fully integrated banking and capital market and a higher degree of institutional integration to protect that market is of great importance," he said.
"Cross-border markets create a community of interest from which each member stands to benefit. But they also heighten shared exposure to the potential detriment of all. For markets to be truly free, therefore, they need governance."
Countries that share a single currency and a single market should "almost undeniable" have stronger common governance and deeper institutional integration, he said. He added that it was therefore a priority to complete a banking union, a fully-equipped single resolution mechanism and a uniform deposit insurance scheme.
At the ECB's October meeting, Draghi convincingly signposted the possibility of more quantitative easing (QE), sending the euro to a two-month low against the greenback. However, he did little to garner the same reaction on Wednesday. The euro had fallen to a session low of near 1.070 against the dollar before his speech but failed to gain any ground during his comments.
In October, Draghi spoke about the possibility of negative deposit rates and more asset purchases. It still remains unclear, however, whether the bank will extend its current 1 trillion euro ($1.1 trillion) asset purchase program beyond next September, or simply ramp it higher by increasing the monthly amount it buys.