The method worked out to wind up or rescue eurozone banks was looking very complex as ministers battled late into the night to reach a compromise.
Contributions from banks will after 10 years from 2016 amount to around €55 billion, which can then be used to raise further money on the markets. Before that the levies will be paid into separate apartments for the banks for each country.
Banks in trouble will have to bail-in bondholders and investors and raise money on the markets if possible before approaching the single fund.
But if there is not sufficient for its needs, then the country in which the bank is located can borrow on the banks’ behalf from the EU rescue fund, the ESM.
This will come with a programme of measure the country will have to take, which EU sources say will be lighter than the austerity programme to which Ireland has been subject.
Countries have until 2026 to decide how they will build up a permanent backstop to ensure taxpayers are no longer on the hook for banks.
The proposals were criticised as overly complex especially since winding up a bank would have to be done over a weekend when markets are closed. The decision to shut a bank can be made without the permission of the member state if the ECB has concerns but the decision will be made by 127 people on 9 different panels.
The decision to release funds will have to be made by the Single Resolution board with two thirds of the 23 members, representing at least 50% of the value of the contributions in the fund, making the final decision.
The European Commission has been relegated to an observer status with the board made up of member states and a number of independent members having control. Earlier, Internal Market Commissioner Michel Barnier expressed his concerns about some of the details: “Decisionmaking within the SRM is still too complex with a consultation system which slows down the process unnecessarily. What we are building is a single system and not a multi-storey inter-governmental network.”