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BANKING: New Euro watchdogs to keep tabs on banks

Financial Regulator Matthew Elderfield and Irish banks will face closer examination by EU watchdogs from next year, following an agreement signed in Brussels.

A total of three EU-level agencies are due to be set up to police stock markets, banks and the insurance sector.

European Central Bank president Jean-Claude Trichet will chair a new risk watchdog and will have the power to issue colour-coded warnings to governments on risks to their economy, such as swelling asset bubbles.

The regulators will be able to investigate individual countries' financial activities or products and, in emergency situations, put in place temporary bans.