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    EU says Spain aid measure will be OK’d by year’s end

    France’s Francois Holland:“The worst is over.”
    France’s Francois Holland:“The worst is over.”

    BRUSSELS — European Union leaders said early Friday that legislation enabling rescue aid to be channeled directly to Spanish banks should be agreed by the end of the year, but they left open critical decisions on how soon it could go into effect.

    By leaving the start date vague, Germany could shape the legislation over the next three months to delay any use of a new bailout fund to directly recapitalize Spanish lenders until after national elections in September 2013.

    The legislation focuses on improving supervision of banks in the euro area by putting them under the aegis of the European Central Bank, and it is one of the tools developed by Europeans aimed at salvaging the euro.


    The leaders agreed at their last summit in June that the direct recapitalization of banks could go forward once effective supervision by the European Central Bank is in place.

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    But such direct aid could be an election issue because German citizens have grown weary of paying most of the bill for bailouts, and they are wary of using more funds to help Spanish banks.

    At a news conference Friday morning, Chancellor Angela Merkel of Germany would not give a precise start date for the system nor for the direct recapitalization of banks.

    Merkel said that Mario Draghi, the president of the central bank, had informed leaders that ‘‘it will take some time until this banking supervision is up and running.’’

    The French government and the European Commission have sought to hasten that legislation in order to allow direct recapitalization of some of the euro­zone’s most vulnerable banks to start on Jan. 1.


    But Francois Hollande, the French president, was also unable to give a date for the start of the system and instead said markets should be confident that direct recapitalization of banks would be able to go forward over the course of 2013.

    ‘‘The worst is over,’’ Hollande said, seeking to assure investors and citizens that Europe was keeping up momentum to emerge from its financial crisis.