German Chancellor Angela Merkel said it’s an open question whether European policy makers can meet the deadline they’d set hours earlier to establish a euro-area bank supervisor by year-end.
“There are complicated questions to clarify and we’ll see in December if we complete it or not,” Merkel told reporters after a two-day European Union summit in Brussels wrapped up today. “For now, the political will is there.”
The banking supervisor can “probably be effectively operational,” allowing the euro bailout fund to lend directly to banks as soon as 2013, EU President Herman Van Rompuy told reporters around 3:20 a.m. today after the first round of summit meetings. He said finance ministers will design rules for such bank rescues.
Spain estimated on Sept. 28 it may need about 40 billion euros to recapitalize its banks. The government has played down the necessity of seeking additional aid while pushing for progress on a European banking union.