European Union leaders capped a third year of debt-crisis management with Greece obtaining fresh financial aid, a euro bank regulator taking shape and Germany and France sparring over what to do next.
German Chancellor Angela Merkel and French President Francois Hollande, stewards of the euro area’s top two economies, promoted conflicting visions of how to revamp the currency bloc once the fiscal crisis subsides.
Accords on bank supervision and Greece’s next disbursement left the leaders to focus on a “road map” for turning the euro zone into a “genuine” economic union over the next 5 to 10 years, with models such as the federal systems in the U.S. and Switzerland.
The conflict will carry over into next year’s debate on the path toward a banking union, with the goal of giving central authorities the power, and the financing, to deal with failing banks. At stake is when the 500 billion-euro European Stability Mechanism rescue fund would get the power to recapitalize banks directly, essentially using European money to clean up mistakes made at the national level.