The EU has reached an agreement to establish rules will pay the bank bailout in the future, rather than the taxpayers foot the bill.
After seven hours of talks Thursday by the 27 EU finance ministers earlier this agreement is to establish the European Union and the so-called banking restore financial and economic stability, the EU's goal of combating the recession has taken an important step.
A set of rules to determine the order of investors and creditors will have to bear the loss, when the banks to restructure or close a last resort only limited taxpayer-funded bailout.
"This is a major shift from the public hand segment, from the taxpayer if you will, back to the financial sector itself, it will now become a very, very large extent, responsible for handling their own problems," said Dutch Finance Minister Jeroen Dijsselbloem.
Ministers to 19 hours of continuous negotiations failed to reach agreement last week, their latest round of talks in Brussels, the EU's 27 heads of State and Government came only hours before the summit. At the summit, EU leaders will take stock of progress in the euro zone's financial and economic policies.
Exactly one year ago, EU leaders pledged to resolve the euro zone's financial crisis by introducing a banking union, designed to make banking supervision and rescue European institutions, rather than weaker members left to fend for themselves.
Since it was promulgated, the project has been in many respects, not stalled because rich countries are worried that they weaker countries banking crisis might have to pay. But Thursday's breakthrough to the credibility of a new effort by establishing clear rules.
German Finance Minister Schaeuble said: "The talks are long, very difficult and intense,." "This is an important step, we have progress, step by step" towards the completion of banking union, he added.
Today, EU governments will begin consultations with the European Parliament legislation.
After the financial crisis of 2008-2009, Ireland, the United Kingdom and Germany and other countries billions of dollars in new capital into the pump dozens of troubled banks to avoid financial meltdown.
To prevent this from happening again, ministers discuss who should contribute to the order, the number of the bank's rescue - a so-called bail - so that ordinary taxpayers will not leave bill.
Irish Finance Minister Michael Noonan, stressed: "" Bail is now the rule, add the rule to eliminate moral hazard, making it clear that banks will suffer the damage, the government may come to help, if at all. "Banks are considered the way, this is a revolutionary change," he added.
Rules foresee the bank creditors and shareholders are the first to take losses. However, if this is not enough to prop up the lender, uninsured deposits worth more than 100,000 euros ($ 132,000) for small businesses and ordinary depositors will also take a hit, officials said.
Those forced losses up to 8%, the bank's total liabilities, the only way to kick the top of the governments bailout, could be worth 5% of liabilities.
Negotiations are complex, because fear of being too rigid in some countries of the European rules. Others warned that the euro is weak and strong economic and lack of common rules would undermine the certainty and undermine investor confidence in the financial system, between too much flexibility will cause new imbalances.
But the same rule applies to 17 EU countries share the euro currency in 10 member states, such as the UK has its own currency, said the Netherlands Dijsselbloem, who also chairs the eurozone finance ministers' meeting.
Europe has had to face this serious banking problems. Cyprus to seek bailout loans, it can no longer bear the cost of bank bailouts.
The island's European creditors and the International Monetary Fund (IMF) for a preliminary agreement, triggering fears of the market, because of its exposure under the guarantee of ? 100,000 small savers deposit losses.
The agreement is to quickly overhaul, but in some of the large bank deposit holders were forced to take stringent losses.
In the United States, the Federal Deposit Insurance Corporation (FDIC) the rules, more than 250,000 U.S. dollars of deposits in case of bank failures may have to bear the loss.
EU's new rules also foresee the establishment of a national bank restructuring fund will eventually be merged into a European resolution authority, one of the three pillars of banking union.
Another part of the Association of Banks in the next year will be anchored into operation, which is due to the ECB's big banks focused supervision. The third part, jointly guaranteed by deposit insurance, but the discussion is only in its early stages.
 



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