European ministers to meet again to break impasse on bank crisis

European ministers to meet again to break impasse on bank crisis

European ministers will make a fresh attempt to break the impasse on who will pay for banks collapses at a meeting on Wednesday, as they failed to hit an agreement on Saturday.

Ministers on Saturday failed to agree to set up an EU-wide regime which would first impose losses due to banks' collapses on shareholders and bondholders, and then on depositors with deposits of over 100,000 euros ($132,000).

In the meeting, which ran for nearly twenty hours, France insisted for mitigating rules designed to spare taxpayers in future bank crises. One EU official described the Saturday's meeting as chaotic.

European governments are struggling to agree on common way to close failed banks without burdening taxpayers. However, Michel Barnier, the European commissioner in command of regulation, is optimistic that a political agreement is not far off.

Speaking on the topic, Barnier said, "I think we can reach a deal if we take a few more days. We are not far off now from a political agreement."

The European Union (EU) spent nearly 33 per cent of its total economic output to save its banks between 2008 and 2011, using taxpayers' money but the union is still struggling to arrest the crisis.

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