Kenny: EU must federalise response to banking crisis

Enda Kenny has taken a thinly veiled swipe at the European Central Bank and suggested it is time Europe “federalise” the response to the banking crisis.

Such an approach would see the new European bailout fund, rather than taxpayers in an individual state, recapitalise systemically important banks.

“As well as aggravating the financial crisis, the insistence to date that taxpayers in each member state must stand behind the entire liabilities of banks regulated in their jurisdiction has probably been the greatest reversal in the European Single Market since its foundation,” the Taoiseach said.