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Europe unable to break impasse on who pays when banks fail

Europe failed to agree on how to share the cost of bank failures on Saturday, the German taxpayer to spare no effort to resist the French tried to downplay the crisis in the future rules.
Talks late into the night, almost 20 hours may not be forged to set up a state within the EU regime, shareholders and bondholders will be applied first in a bank failure losses, followed by deposits of more than 100,000 euros ($ 132,000) of way.
Ministers will make a fresh attempt on the eve of the summit of EU leaders to break the deadlock at a meeting last Wednesday to address a European banking crisis brought about by the most difficult problem - how to turn off without sowing panic or increasing the burden on taxpayers failed bank.
"I think, if we take a few more days, we can reach an agreement," said Michel Barnier, the European Commission is responsible for monitoring. "We are now not far from the political agreement."
EU to spend the equivalent of its savings banks between 2008 and 2011, with taxpayers' cash, but in an effort to contain the crisis - in the case of Ireland - almost bankrupt one-third of the country's economic output.
German Finance Minister Wolfgang Schaeuble accused of conflict of interest issues and complexities, not able to reach a final result on Saturday. EU officials, who asked not to be named, conference chaos.
The heart of the differences, mainly between Germany and France, is how much leeway the state should have the momentum losses bondholders or large depositors, a process called "Bail."
This approach was first tested in March in Cyprus bailout, but the EU standards, would mark a radical departure from the euro zone crisis management have left the taxpayer as a string, the bill's rescue plan.
Britain, Sweden and France is concerned, forcing depositors may cause loss of bank runs or rattle confidence and hope that the state has broad freedom to decide whether to take such a bold step.
Spanish Economy Minister Luis de Guindos emphasized the sensitivity of the issue. "There is a hierarchy of consent on bail and protect small savers," he said.
Germany, however, must strictly regulate. Schaeuble said the new rule changes should not cross the 27-nation European Union, because it can put some banks at a disadvantage in the competition.
"There is clear disagreement between France and Germany, said:" This is why after the meeting, an EU diplomat.
French Finance Minister Pierre Moscovici tried to downplay any department, and that transaction may be next week.
"Dangerous"
Although there is no deadline for reaching agreement immediately, hesitation could hurt the ability of European politicians to repair confidence in the financial system and encourage banks to lend and help the continent out of economic stagnation.
Close agreement of the European banking rules also need a step by the German front, the 17-nation eurozone bailout fund to help banks in trouble, potentially important in helping the Irish plan was signed.
"In fact, the euro zone countries are trying to promote solutions for the rest of us are very dangerous," Swedish Finance Minister Anders Borg told reporters.
System to ensure that troubled banks shut down in an orderly manner set an important precedent, which is pursuing a project called the euro area banking union to supervise, control and support for banks to rebuild confidence in the currency.
This project aims to form a common front across the single currency area failed to deal with the bank, rather than leaving it to individual countries to manage.
In the wider EU level, the so-called resolution rule is necessary so that the eurozone mold its own regime and decided how the eurozone bailout fund to help banks.
Its rules, for example, pushing a large depositor losses which may be more stringent, especially banks seek help fund, the European Stability Mechanism.
Euro zone finance ministers agreed on Thursday night through the Fund ? 6,000,000,000 banks.
If you agree, then the provisions of the rules will be in effect starting in 2015 as in 2018 at the end of the implementation of the losses.
 
 



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