Britain insists all German banks should be regulated

13 September 2012

Britain wants all 6,000 eurozone banks to be supervised by the new European regulator - including smaller German financiers, it has emerged.

Jose Manuel Barroso, president of the European Commission, yesterday (12 September) unveiled plans that will provide the European Central Bank with significantly more control over lenders across the economic bloc as of next year.

Mr Barroso claimed that establishing a banking union is a vital step towards resolving the eurozone's ongoing debt crisis, but German officials have argued that smaller companies should be exempt from such oversight.

However, in a secret negotiating document distributed in Brussels and seen by the Daily Telegraph, the UK has rejected this idea on the basis that leaving some banks out would "pose significant risks to euro area financial stability".

Policymakers from the UK - who have already insisted their nation will not join the banking union - went on to state there is "ample precedent" to suggest that not only large financiers cause "systemic instability".

By Gary Cooper

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