The provisions of the EU agreement for the Banking Union

The finance ministers of the European Union reached a historic agreement for the Banking Union, in a meeting which was characterized as the most important after the adoption of the single currency.

For the first time in its history the EU managed to follow the developments and create a single clearing mechanism before the end of 2013. This is one of the most important decisions it has ever received and provides for a European mechanism that will have funds of 55 billion euros to be raised from contributions of financial institutions over the next 10 years.

The agreement is the second and most crucial step towards the full banking union Eurozone and the EU and will culminate with the adoption of a single security deposit mechanism that must be approved by the European Parliament before the European elections in 2014.

According to initial information, the historic decision ensures that European citizens will not be required to pay with their taxes for the rescue of a problematic financial institution, but there will be a single rule of controlled bankruptcy of banks, which will enter into force in 2016.

"Today is a historic day. We made revolutionary decisions for the banking sector in the EU," European Commissioner for the Internal Market Michel Barnier said while the Finance Minister of France argued that the agreement between France and Germany was crucial to reach an agreement on a historic moment of the EU.

The agreement on the single clearing mechanism is a highly complex process that the Greek Presidency of the Council will undertake to finish.