EU wants summit backing for banking union

Mon Dec 10, 2012 12:51pm EST
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By Luke Baker

OSLO (Reuters) - European Union leaders are likely to give political backing for the European Central Bank to be made the single supervisor of euro zone banks later this week, EU officials said on Monday, even if the final details may not be agreed until next year.

Leaders meet in Brussels on Thursday and Friday for their last summit of the year, with the focus on setting up a 'banking union' across the euro zone and wider EU, a plan built around the ECB taking lead responsibility for banking oversight.

Herman Van Rompuy, the president of the European Council who will chair the December 13-14 summit, said he was hopeful that leaders would give their backing to the scheme, and EU officials speaking on condition of anonymity said they expected "political agreement" at the summit with the details worked out later.

"I still hope and I'm quite sure that we'll find a solution on the legal framework before Christmas, before the end of the year," Van Rompuy told reporters in Oslo, where he received the Nobel Peace Prize on behalf of the European Union.

"There's work to be done, but I have a lot of indications that there is the political will to find a solution for the single supervisory mechanism."

Twenty EU heads of state and government were in Oslo to attend the Nobel prize giving and took the opportunity to discuss the economic crisis over lunch, officials said.

German Chancellor Angela Merkel emerged from those talks saying she felt "more courageous" about tackling the problems EU governments face, but didn't go into details.

Germany is one of the main obstacles to a deal on the ECB taking responsibility for monitoring the euro zone's banks.   Continued...