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No unity yet on banking union

Monday, December 09, 2013 - 02:00

Dec. 9 - Investors are missing clarity on the world economy but European finance ministers are unlikely to provide it. That's the view of many as Europe's finance ministers again attempt to make progress on banking union. Sonia Legg reports.

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The euro zone has been in a spin for some time now. And many investors are fed up feeling dizzy. They see Europe's finance ministers as a source of the clarity they need. But will they get it from the latest meetings in Brussels? Michala Marcussen is head of Global Economics at Societe Generale. SOUNDBITE: MICHALA MARCUSSEN, GLOBAL HEAD OF ECONOMICS, SOCIETE GENERALE, SAYING (English): "We are really looking to see progress on the different elements of the banking union. Now when we look at the euro group political process we have to understand that it is a complicated one and it is quite normal that it will take time. My own personal preference would of course be to see some acceleration here." It's the umpteenth time banking union has been on the finance ministers agenda. It's seen as key to Europe's recovery and Germany's Finance minister says they need to get it right. (SOUNDBITE) (German) GERMAN FINANCE MINISTER WOLFGANG SCHAEUBLE SAYING: "There is still a lot of work today. I am not sure if we can do it in one meeting or if we need another one......But, I am positive that we will achieve something good." Among the sticking points are how to close failing lenders, in order to clean up the sector and win back investor confidence. That's close to the heart of Ireland's Finance Minister - Dublin was bailed out after a banking crisis. (SOUNDBITE) (English) IRISH FINANCE MINISTER MICHAEL NOONAN SAYING: "I hope the ground will be narrowed and I would like if agreement were reached tomorrow evening, but there are some wide differences and we may be in the situation where we would have to meet again for Christmas." The ECB is ready to step in if need be but patience is wearing thin. (SOUNDBITE) (English): MICHALA MARCUSSEN, GLOBAL HEAD OF ECONOMICS, SOCIETE GENERALE, SAYING: "I think what is more important to me is that at the end of the day we do see a full banking union and that's where my concern is - that what we will see is more of a co-operation between national regulators than a full blown banking union at this point in time - any delay on that front will be disappointing." The banking crisis has certainly dragged down European growth . And recently there's little relief in the US. The Federal Reserve has been equally non-committal about when it might end its easy money policy.

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No unity yet on banking union

Monday, December 09, 2013 - 02:00