BERLIN Dec 13 German Chancellor Angela Merkel
hailed on Thursday an agreement clinched by EU finance ministers
on giving the European Central Bank new powers to supervise euro
zone banks and said Germany's core demands had been met.
The 27 ministers agreed early on Thursday after lengthy
negotiations to grant the ECB the authority to directly police
at least 150 of the euro zone's biggest banks and intervene in
smaller ones at the first sign of trouble.
"The importance of the deal reached this night on the legal
basis and main features of a supervisory mechanism for banks
cannot be too highly assessed... We succeeded in securing
Germany's key demands," Merkel told the lower house of
parliament, the Bundestag.
"We will have a clear separation of responsibility for
monetary policy and of the banking supervision," she said.
Germany had been concerned about a potential conflict of
interest between the ECB's role as both supervisor and guardian
of monetary policy. The deal sets up a mediation panel to
resolve disputes with national supervisors.
Berlin also wanted to retain primary oversight over its many
smaller savings and cooperative banks, most of which under the
new accord will not come under direct ECB surveillance, unless
they run into problems.
The new system of supervision should come into force on
March 1, 2014, following talks with the European Parliament.
Merkel, who flies to Brussels later on Thursday for a summit
of EU leaders, said she saw good chances for implementing a new
tax on financial transactions involving 11 euro zone member
The German leader also praised the reform efforts of
Greece's new conservative-led government and said she expected
euro zone finance ministers to approve on Thursday the payment
of fresh loans to the crisis-ridden country.
Merkel said she expected the EU to emerge stronger from its
sovereign debt crisis, which erupted in Greece three years ago
and which has dominated her second term as German chancellor.
She hopes to win a third term in elections next September.
But she said European politicians must show courage to
implement the tough fiscal and structural reforms needed to put
the continent's economy back on its feet.
"This courage to bring about change is what we need, and
therefore I am convinced that Europe will manage to come out of
this crisis stronger than it went into it," Merkel said.
"This is the great mission of our times."