EU leaders welcome eurozone banking deal

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EU leaders welcome eurozone banking deal

EU leaders welcome eurozone banking deal
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European finance ministers meeting in Brussels have reached unanimous agreement on a deal paving the way for closer integration in the eurozone.

The European Central Bank is to get new powers to supervise the eurozone’s financial institutions.

The move is seen as vital to bolster the euro and prevent crises, and a major step towards full banking union.

After hours of talks lasting into the night, the 27 countries finally reached a compromise ahead of an EU summit.

“This is a signal to the rest of the world: we can trust Europe, we can trust the eurozone. It is an area with great potential and in which we can invest, in which we can trust,” said French Finance Minister Pierre Moscovici.

“The year 2012 ends under good auspices for the eurozone and I am happy about that,” he added.

France and Germany had disagreed over the extent of the ECB’s powers.

Under the deal, due to come into effect in March 2014, the ECB will directly oversee 200 of the eurozone’s biggest banks. Others will still be supervised by national bodies but the ECB can intervene if it sees trouble.

New mechanisms will be put in place for countries outside the euro.

The UK will not be joining, but the government has welcomed the deal, estimating that British interests are being protected.