Britain would reject the opportunity to join a banking union in the eurozone should such an arrangement be set up, a senior government official has pledged.
Speculation has mounted in recent times that European Central Bank policymakers may seek to create a union involving financiers across the economic bloc as this would help restore some stability to the region.
However, chancellor George Osborne has categorically ruled out any British participation in such a plan on the grounds that doing so could have a negative impact on the wellbeing of the City of London.
"There is no way that Britain is going to be part of any euro zone banking union. I think Britain will require certain safeguards if there is a full-blown banking union," he noted.
The minister went on to urge the eurozone to use its emergency bailout fund to help recapitalize Spain's banking system sooner rather than later.
By Gary Cooper