FRANKFURT Nov 19 A European banking union risks
a conflict of interests between banking supervision and monetary
policy and these two areas must be separated, European Central
Bank policymaker Jens Weidmann said on Monday.
Weidmann, chief of Germany's Bundesbank, has resisted a push
to broaden the ECB's remit by putting it in charge of banking
supervision in Europe - a move he says risks compromising the
ECB's main goal of price stability.
In a speech at Euro Finance Week in Frankfurt, the
Bundesbank chief also pushed for Germany to have a strong voice
in supervision voting in a European banking union.
"As such decisions could also lead to fiscal costs, it would
only be consistent to have voting weights based on capital
shares," Weidmann said in the text of a speech for delivery at
Germany's Bundesbank has the largest share of the capital
base at the ECB, which policymakers envisage taking on the role
of European banking supervisor.
"The banking union should relieve common monetary policy -
but there is a conflict of interests between banking supervision
and monetary policy in the practical implementation," Weidmann
"Both areas must therefore be strictly separated," he added.
"This separation is doable, but difficult - difficult from an
organisational viewpoint and difficult from a legal viewpoint."
(Writing by Paul Carrel)