European leaders step closer to bank supervisor but deal hazy
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European Commission President Jose Manuel Barroso (left) and European Council President Herman Van Rompuy hold a news conference at the end of the first session of a two-day European Union (EU) leaders summit in Brussels on Oct 19, 2012. EU heads of states and government took a big stride towards establishing a single banking supervisor for the euro zone, striking a deal under which the bloc's rescue fund could start recapitalising ailing banks next year, a French government source said. -- PHOTO: REUTERS
BRUSSELS (AP) - European leaders have taken a step towards the creation of a single supervisor for banks in countries that use the euro but details over when it will be up and running have yet to be ironed out.
Though the leaders said their decision represented a step forward in the ambition of forging a banking union, many observers are struggling to figure out exactly what has been achieved.
But the question remains whether the agreement will allow Europe's bailout funds to recapitalise struggling banks directly - and how quickly - thereby breaking one of the damaging links between indebted governments and the banking system.
Leaders move into discussions on foreign policy on Friday.
