Europe banking union set be complex and political

Europe’s efforts to form a united front behind eurozone banks are reaching a climax, but many fear they will fail to restore confidence and prove flimsy should another crisis strike.

After more than a year of talks, ministers from across the EU agreed early on Thursday, a scheme to close failing banks, but the process will be complex and politicised. An agency and fund to wind down bad banks, working in tandem with the ECB as the new watchdog, is an important step towards banking union, but the loose ends could lead to the complete unravelling of the project.

Although hailed as a “historic” moment by France’s finance minister Pierre Moscovici, many who emerged from the meeting in Brussels were disappointed. “It’s really a farce,” said one senior official. We’re patting other on the shoulder and congratulating each other, but really what has been achieved is a far cry from what was needed.”