Finance ministers of the European Union locked horns Tuesday over the creation of a single banking supervisor for the euro area, which is supposed to be a key tool for avoiding future financial crises. The union’s leaders agreed in June to create the single regulator under the aegis of the European Central Bank. Shortly afterward, the European Commission proposed phasing in the system starting Jan. 1. But sharp divisions have emerged among member states over how many of the 6,000 banks in the euro area should be covered by the new system; how to ensure that countries outside the system have a way to rebuff regulations they dislike; and how to ensure that the central bank keeps monetary policy separate from its decisions on bank supervision.
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