BRUSSELS Dec 4 EU finance ministers discussed
plans for a supervisory mechanism for banks on Tuesday, but the
depth of divisions between France and Germany highlighted the
difficulty in reaching agreement, making a year-end deadline
Tuesday's occasionally heated talks ended in disagreement
and the ministers will resume their discussions on Dec. 12.
Following are comments from ministers and officials after
GERMAN FINANCE MINISTER WOLFGANG SCHAEUBLE
ON BANKING SUPERVISION:
"We support the goal of a joint European banking
supervision. It's an important part of our efforts to stabilise
the European internal financial market and the European currency
but we also have to make sure that the decisions include the
"We need a consistently high standard of supervision for all
financial institutions in the participating member states. That
can't just be true on paper but has to be true in reality as
"We all agree that no European institution can supervise all
6,000 European banks with the same intensity, so a solution has
to be found which banks are supervised by national authorities
and which by the European ones.
"I believe that we will find a solution that will be in line
with the Commission's compromise that the European Banking
Authority gets the right to monitor the national supervisors and
will get the right to get involved, although we are still trying
to reach agreement on the criteria for such a right.
"We had a discussion again about how to make sure that
within the ECB the responsibility for monetary policy... (and
involvement in supervision) are absolutely separated. That also
includes opening the possibility for non-euro zone states to
participate in the banking supervision on the basis of equal
treatment. We still need a solution to both of those items.
We're working on that.
"We will get together probably on the afternoon of Dec. 12
to find a solution before the EU summit.
"For the banking supervision we need democratic legitimacy
and legal control, for monetary policy that is excluded by the
need for independence. So it needs to be clearly separated. The
heads of state and government decided nothing else, because they
agreed that European banking supervision should include the ECB
but they did not say that the ECB should build up a European
ON BAILOUT FOR CYPRUS:
"We discussed the first draft of a memorandum of
understanding for Cyprus. A lot more work is needed. That's
everyone's opinion and many member states have said that
"That's both about the banks' needed volume as well as the
question who the creditors are and how the creditors can be
involved in taking the costs of the recapitalisation of the
"We expect complete financial transparency from Cyprus
relating to money laundering issues, which fulfil EU standards
and international requirements. We also expect quick
implementation of all requirements that international
"On top of that we need extensive cooperation on tax
"We will also have to consider how to reduce the (size of)
the Cypriot financial sector, which is over-sized, and how,
given the debt level, we can approach privatisation."
ON LEADERSHIP OF EUROGROUP TO REPLACE JEAN-CLAUDE JUNCKER:
"I am one of the people who regrets his decision. We each
said three-quarters of a year ago that we both deem the other to
be the adequate candidate and I got through with that then. Now
we will have to see what we will do with it. I won't say more
than that. Those involved have to take a look at it and discuss
it now, and speculation won't help us."
Following are comments from before Tuesday's discussions:
SWEDISH FINANCE MINISTER ANDERS BORG
ON THE POSSIBILITY OF COMPROMISE OVER THE ECB'S ROLE:
"We think there should be equal treatment to all members of
the European Union that want to join the supervision board.
"There can be no unfair treatment of the non-euro countries.
There must be safeguards and we must be able to set our own
capital requirements, higher capital requirements for banks.
"There could be a compromise today but there is quite a lot
of road to travel. There is a long time to Christmas. We can
have extra Ecofins (meetings of EU finance ministers) at any
time and continue negotiations."
AUSTRIAN FINANCE MINISTER MARIA FEKTER
ON WHO WILL SUPERVISE WHICH BANKS:
"We will have to find a mix. On the one hand national
supervisors have the capacity to deal with such a supervisory
function, on the other hand the new institution has to set the
tone. We are likely to chose a layered approach whereby the tone
is set by the main regulator and operationally the national
bodies are used to carry out supervision on the spot.
"There are countries that insist that small banks are not
supervised by the central authority but Austria is open. We
believe that the same rules and methods should apply to all. Who
carries out the inspections on the ground should not matter."
FRENCH FINANCE MINISTER PIERRE MOSCOVICI
ON FRANCE'S POSITION:
"We in France want a supervision system that applies to all
the banks - all the banks in the European Union - that is
directed by and under the responsibility of the European Central
ON POSSIBILITIES FOR COMPROMISE:
"The problems in Europe do not just come from the banks
called systemic. It's natural that banks have national
supervisors too. But the European Central Bank has to have the
ultimate responsibility and control, otherwise it's not a real
system of banking supervision. We can be flexible and find
practical arrangements for local banks, but the principles have
to be respected."
(Reporting by Annika Breidthardt, Sebastian Moffett, Robert-Jan
Bartunek and John O'Donnell; compiled by Sebastian Moffett and