German Finance Minister Wolfgang Schäuble has signalled a readiness to compromise on the EU's planned banking union and said leaders are working intensively to agree on a legal framework by Christmas, German media reported.
"We are working intensely to get the legal framework for a banking supervisor settled before Christmas", Schäuble told German newspaper Bild am Sonntag, in an interview published on Sunday. "We can start building up the supervisory body in 2013", he added.
Spiegel magazine reported that Schäuble was prepared to seek a compromise with France by suggesting the supervisory body could be domiciled in Paris, rather than at the ECB's headquarters in Frankfurt. According to Spiegel, Schäuble wants a clear separation between the ECB's supervisory and monetary policy duties. Placing the supervisory body in Paris could help achieve this.
Bundesbank chief Jens Weidmann echoed Schäuble's call for a clear separation of monetary policy and supervision, and called for a change to the European constitution in order to clarify the separation, in an interview with Welt am Sonntag newspaper. "I cannot see how with the current legal framework we can transfer supervisory duties to the ECB. A clean legal solution would require a change to the constitution", he told the paper. Such a change would require extra time and could delay the introduction of an EU-wide banking union. But he added: "If politicians really want a banking union, then they will be able to make the necessary political decisions swiftly".
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