video transcript

Hope at last for those in favour of a European banking union. Germany has reportedly agreed to let the ECB become the chief supervisor of the euro zone's banks. Their reluctance had been a significant obstacle to carrying out the EU's most ambitious financial reform. The breakthrough was acknowlegded by finance ministers arriving for a meeting in Brussels about banking union. Ireland's Michael Noonen. (SOUNDBITE) (English)IRISH FINANCE MINISTER MICHAEL NOONAN SAYING "Just as we came in we got a text to say that there was a French/German compromise paper circulated. So, on the basis of that it looks as if there is at least the basis for an agreement there now. It will be a long meeting though, I am sure as there are lots of issues, but I will be hopeful." A banking union could help the bloc achieve a united front when dealing with problem banks and the debt crisis. But Michael Leister from Commerzbank isn't convinced much will come from the meeting. (SOUNBITE) (English) MICHAEL LEISTER FROM COMMERZBANK, SAYING: "I wouldn't get my hopes up too high but given the comeback of political risk the markets should be fairly resilient to any noise on that account." Those against a union were similarly pessimistic - but not about the lack of action - more the prospects for those outside the euro zone - like Sweden. (SOUNDBITE) (English) SWEDISH FINANCE MINISTER ANDERS BORG SAYING: ON AGREEMENT ON BANKING UNION: "I think it's actually a sad day for Europe in that we will be more divided on this day than before. And we think we should send a strong signal at the European Council that there is a move now towards Euro banks, euro taxes, euro transfers, euro commissions and we think these are steps in the wrong direction." Berlin - much to the annoyance of France - has dragged its feet for months over concerns about who will foot the bill for any failing European banks. And there are still other issues, including the number of banks the ECB should supervise and how long they should do it for. All countries need to agree too and Britain is another major obstable - it fears its banking sector will suffer. But many EU leaders do see a single banking authority as a way to stop troubled lenders dragging their countries into the debt crisis - and that's worth fighting for.