Bank supervisor work is on track, Noonan claims
FINANCE Minister Michael Noonan is confident the majority of work on a European bank supervisor will be done before Ireland assumes the EU presidency in January.
Mr Noonan said the bulk of laying out the framework for the supervisor, which needs to be set up to break the link between sovereign debt and bank debt, will be completed by then.
But it may fall to Ireland's presidency to bring the new rules into practice. Cyprus holds the presidency until the new year.
The European Central Bank will take on the supervisor role, as well as monetary powers, but there will be a split between the two arms of the ECB.
Central banks in member states will play a role in making sure their banks comply with the common regulations.
Mr Noonan said: "The legal competence for the supervision would be vested in the European Central Bank, but they would delegate some of the supervision activities to the local central banks and the different sovereign states.
"To do that, not only would you need the legal competence vested in Frankfurt, but you need the rule book and the manuals and the protocols so you have high standard common regulation in all the states.
"There is also very strong policy view that the monetary role of the ECB would be separated from the supervisory role."
Mr Noonan was speaking after a meeting of EU finance ministers in Brussels yesterday.
He said provision would have to be made for eurozone members who wanted to be part of a banking union, as well as those outside the eurozone who did and did not want to be part of the union.
Mr Noonan said there had been no progress on a deal for Ireland's bank debt, but he had raised it on the fringes of the meeting.