You can now read 5 articles in a month for free on BostonGlobe.com. Read as much as you want anywhere and anytime for just 99¢.

EU approves central bank overseer

Italian finance minister Fabrizio Saccomanni (left) and his Lithuanian counterpart, Rimantas Sadzius.

Geroges Gobet/AFP/Getty Images

Italian finance minister Fabrizio Saccomanni (left) and his Lithuanian counterpart, Rimantas Sadzius.

LUXEMBOURG — European Union finance ministers on Tuesday approved the creation of a centralized banking supervisor, another step in the 28-country bloc’s long quest to stabilize its financial system.

The new banking supervisor will be operated by the European Central Bank and oversee the 130 biggest banks.

Continue reading below

The so-called single supervisory mechanism will be based in Frankfurt and will recruit about 1,000 staffers.

It is due to be operational late next year after assessing European banks’ balance sheets through a stress test that will identify possible capital shortfalls.

If the supervisor finds a bank needs help, a rescue authority would step in to unwind it or rescue ailing lenders by using money from a common fund. The ministers were still far from reaching an agreement on how to design and fund the rescue authority.

Germany and other countries that have paid the bulk of Europe’s bailouts have concerns about the institution’s legal basis and fear their taxpayers will be stuck with bills to clean up banks in Europe’s weaker economies.

Loading comments...
Subscriber Log In

You have reached the limit of 5 free articles in a month

Stay informed with unlimited access to Boston’s trusted news source.

  • High-quality journalism from the region’s largest newsroom
  • Convenient access across all of your devices
  • Today’s Headlines daily newsletter
  • Subscriber-only access to exclusive offers, events, contests, eBooks, and more
  • Less than 25¢ a week
Marketing image of BostonGlobe.com
Marketing image of BostonGlobe.com
Already a subscriber?
Your city. Your stories. Your Globe.
Yours FREE for two weeks.
Enjoy free unlimited access to Globe.com for the next two weeks.
Limited time only - No credit card required!
BostonGlobe.com complimentary digital access has been provided to you, without a subscription, for free starting today and ending in 14 days. After the free trial period, your free BostonGlobe.com digital access will stop immediately unless you sign up for BostonGlobe.com digital subscription. Current print and digital subscribers are not eligible for the free trial.
Thanks & Welcome to Globe.com
You now have unlimited access for the next two weeks.
BostonGlobe.com complimentary digital access has been provided to you, without a subscription, for free starting today and ending in 14 days. After the free trial period, your free BostonGlobe.com digital access will stop immediately unless you sign up for BostonGlobe.com digital subscription. Current print and digital subscribers are not eligible for the free trial.