The Eurozone Ministers of Finance have agreed a plan to pass on supervisory power to a single common bank supervisor in Frankfurt, following troublesome discussions that lasted four months and laid bare deep Franco-German divisions.
Ministers of Finance from the 17 Eurozone countries devised an agreement for the European Central Bank (ECB) to begin direct supervision of up to 200 Eurozone lenders from early 2014.
The rest of the 6,000 European banks will remain under supervision by (each) national central bank, but the ECB can, at any time, intervene in case of trouble.
In Portugal, banks falling under direct ECB supervision when the system commences will be CGD, BCP, BES, BPI, Santandertotta and Banif; all banks whose assets surpass âŹ30 billion (or 20% of their countryâs GDP).
At the same time, UK, Sweden and other non-eurozone countries outside the banking union won coveted safeguards to check the power of the ECB and maintain some influence over technical standards applied to all EU banks. The UK has already stated it has no intent to join the single supervision system, but Chancellor of the Exchequer George Osborne nonetheless saluted the agreement as âa positive result for all the European Unionâ, considering that his countryâs interests were âprotectedâ. Also see article on page 16.
