19.09.2012
By Simon Miller
France and Germany have room for an agreement over the proposed banking union according to French finance minister Pierre Moscovici.
Although France wants to move quickly to start up the banking union, the two countries are split over the timing and scope of regulation that the European Central Bank (ECB) will be given.
France wants all banks to be overseen by the regulator while Germany wants only systemically-relevant or cross-border institutions to be regulated by the ECB.
In a report seen by Reuters, Germany's ruling coalition members also also reject proposals for cross-border bank deposit guarantees, which they want to remain the responsibility of individual states.
"Deposit guarantees will not be unified across Europe," said Merkel's MPs in the document. "Deposit guarantees may be harmonised but the responsibility must remain national."
The discussion document reflects German chancellor Angela Merkel's view that preparation of the ECB's new oversight powers should not be rushed to meet Europe's self-imposed January 2013 deadline.
Her MPs echoed her wariness, saying in the proposal: "Quality must come before speed in all the preparations."
However, at a press conference, French PM Jean-Marc Ayrault said that his Cabinet had approved the treaty this morning and that it would be presented to parliament on 2 October.
He commented: "Our goal is to move fast. There are always resistance and doubts in each country. Each country has its specific differences. We are in discussion. France wants the supervision of all banks."
Moscovici commented: "There is room for an accord. We are in discussions on the timing of things and on the scale of the approach but it is reductivist to characterise this as some kind of clash. This is the preparation of an important text which requires Franco-German discussion."
Concern over regulator powers is extending to non-eurozone states that are lined up to join the euro in the future.
At his regular press conference, Czech PM Petr Necas commented: ""Weakening national supervision, when we have one performed by the Czech National Bank, which works very well, ... is not something that we would regard as beneficial. The position of the Czech government and the Czech National Bank is very cautious and very sceptical."
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