31 May 2012

European banking union mooted

12:39 pm on 31 May 2012

The European Commission is calling on the 17 countries in the eurozone to create a banking union that could centrally bail out failing institutions.

It says the current crisis should not stop banks from becoming more linked across Europe.

"Flexibility and speed are of the essence," Commission head Jose Manuel Barroso said.

The BBC reports the commission also seems to back the idea of eurobonds, which would be debt jointly issued by all 17 countries in the eurozone.

The euro sank on Wednesday by almost 1% against the United States dollar.