Germany Stands Firm Against EU Bank Deposit Guarantee Plan

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Berlin has quickly rejected plans by Brussels to revive talks on a eurozone bank deposit guarantee scheme, in a sign of how hard it will be to win German backing for further steps to pool responsibility for the bloc’s financial system. The European Commission on Wednesday proposed compromises aimed at ending two years of deadlock over the plans for a European Deposit Insurance Scheme, or EDIS. The plans have strong support from Paris and southern Europe but are viewed with deep misgivings in Germany, the Financial Times reported. Brussels argued that a deal should be reached on the scheme, and other outstanding aspects of the euro area’s so-called banking union, by the end of next year. However Germany’s finance ministry warned on Wednesday that its position “has not changed” and said Berlin would not engage in talks until there was “substantial risk reduction” by Europe’s banks. “The existing proposals by the European Commission are not sufficient to achieve this goal,” it said. Read more. (Subscription required.)