BRUSSELS chiefs are piling pressure on EU members to back plans for a banking union, which will see nations forced to cover bank failures anywhere in the bloc, as it ramps up efforts to reform the Union.
The European Commission wants to plough ahead with the creation of a bloc-wide banking union, which was first proposed in 2012 by the end of 2018, in a bid to prevent a repeat of the 2008/09 financial crisis.
But the plans have repeatedly stalled as neither the EU Council, member states nor the European Parliament have managed to reach an agreement despite two years of talks.
Germany and Denmark are thought to be tough critics of the controverisal plans to reform the eurozone.
EU commission vice-president Valdis Dombrovski is keen to push the debate in a bid to build momentum for reforms to the currency bloc in the next coming months.
However he is set to face strong resistance from Germany, whose banking lobby are opposed to taking on responsibility for non-performing loans held by financial institutions in other countries.
The bloc’s largest economy is demanding clarity on risk sharing and risk reduction.
Angela Merkel’s Germany warns that sharing risk means German banks will inevitably end up supporting weaker banks elsewhere in the bloc.
The European Commission late last year offered a watered-down plan to decrease risks in the banking sector, in a bid to break years of stalemate over the plan that was fiercely opposed by Germany’s former finance minister, Wolfgang Schaeuble.
Full article: Pan-European bank to Enrage Italy Germany & France: Nations FORCED to rescue failing banks (Express)