The credibility of Europe’s efforts to restore confidence in its financial system hangs in the balance as lawmakers try to broker a deal on a bank-failure authority for the 18-nation euro area.
As U.S. Treasury Secretary Jacob J. Lew tours European Union capitals to push for tougher banking regulations, negotiators in Brussels begin a sprint today to create a central agency for saving or shuttering euro-zone banks before elections in May.
When EU finance ministers ended a fractious debate and settled on a blueprint in December, European Central Bank President Mario Draghi “strongly” welcomed the plan, though it diverged broadly from the ECB’s position. The parliament’s stance is closer to the original proposal made in July by Michel Barnier, the EU’s financial-services chief. Now the two sides will try to find a compromise.
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