A compromise text proposes additional rights for nations inside and outside the new banking union, aimed at reassuring the likes of Poland, Germany and Britain. But significantly the single supervisor still holds unrivalled legal authority over all 6,000 eurozone banks – a concentration of power that is likely to rile Berlin, which jealously guards its dominion over smaller German lenders.
The papers are produced by Cyprus, which holds the rotating EU presidency, and mark an attempt to kick-start the talks, which have stalled in spite of EU leaders promising to reach a deal next month.
Many of the amendments floated are highly controversial and it is uncertain if they would win sufficient support, given Member States must agree unanimously on the final supervision package. The options for discussion include:
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two proposed ways to end the “one-member one-vote” principle on the ECB supervision board, so Member States with bigger banking sectors or populations wield more influence;
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a potential route for non-eurozone banking union members to ignore ECB decisions, should the supervision board’s proposals be overruled by the ECB’s eurozone-only governing council;
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a discussion paper on ways to give Britain and other banking union outsiders more voting clout at the European Banking Authority, so that the ECB does not dominate voting on technical rules;
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the removal of the ECB’s responsibility to coordinate the policy positions of banking union members, giving banking union members the freedom to vote against the ECB at the EBA;
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an option giving a banking union member the right to tighten unilaterally its bank rules to tackle a lending bubble, without prior ECB permission.
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