MEPs and member states remain at odds over this proposal to bring all eurozone banks and some non-eurozone banks under a single regulatory and supervisory system.

A trilogue negotiation yesterday evening (5 February) was not expected to produce any major breakthrough on this last element of the EU’s planned banking union.

MEPs adopted a joint position on 17 December, largely backing the European Commission’s proposal. By contrast, when member states agreed their own compromise the following day, after weeks of negotiations, they rewrote important aspects of the plan. They urged reducing the Commission’s role in deciding on whether to rescue or wind up a bank, and limiting the extent to which member state resolution funds will be merged into a single European fund. Member states also enraged many MEPs by deciding to bypass EU procedures and use an intergovernmental treaty to establish the single resolution fund.

In a sign that negotiators have yet to overcome major differences between the two approaches, MEPs remained very critical on Tuesday (4 February) of member states’ position. Sylvie Goulard, a liberal French MEP, said that the member states’ proposal was too cumbersome: “We need quick and effective decisions. The Council’s position does not allow this.”

Corien Wortmann-Kool, a centre-right Dutch MEP, criticised the member states’ position for giving national governments too much of a say over whether to close a bank.

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Missed deadlines

Unless MEPs and member states are able to overcome their differences, they risk missing a self-imposed deadline for an agreement before the Parliament elections in May. The prospect of this deadline being missed was raised by Antolin Sanchez-Presedo, a centre-left Spanish MEP who was standing in for his Portuguese colleague Elisa Ferreira, the lead MEP on the proposal. “We will not support a bad solution”, he said on Tuesday.

Germany, which dominated member states’ negotiations over the proposal, has shown itself unwilling to compromise on the position agreed by member states in December.

Speaking in Brussels last week, Wolfgang Schäuble, Germany’s finance minister, dismissed as unworkable suggestions that more funds for winding up banks should be made available faster. This contrasts with comments made by Pierre Moscovici, the French finance minister, who said last month that “improvements are possible” to the position of the member states.