EU’s ‘big six’ agree on more banking transparency, single overseer

The European Union's six biggest countries agreed on Friday to cooperate in the fight against tax havens, piling pressure on Austria to follow Luxembourg in ending bank secrecy.

The finance ministers of Germany, France, Britain, Italy, Spain and Poland, at a meeting of the EU in the Irish capital of Dublin, announced their plans to push for more bank transparency within Europe and beyond.

The finance ministers are also looking to make progress on the creation of a single supervisor to watch over banks - a task officials say has assumed even greater urgency since a banking crisis in Cyprus stoked renewed fears over the region's debt crisis.

The move by the big six also puts pressure on a recalcitrant Austria to ease up on privacy laws.

The meeting of the 27 finance ministers of the European Union countries is the first since the chaos of the Cyprus bailout, which resulted in big bank depositors suffering big losses and the imposition of capital controls for the first time since the Euro was established in 1999.

The meeting also takes place amid renewed market worries over Europe's debt problems, particularly the size of other banking sectors, notably that of Slovenia's.

"Nobody can deny that bank secrecy is outdated, that we need an efficient system to tackle evasion strategies," French finance minister Pierre Moscovici told reporters, flanked by his counterparts from the other countries. "Our mission is to create momentum. When these six major capitals of Europe move together, it creates a strong signal which nobody can resist."

George Osborne, Britain's finance minister, said he was pushing for more transparency from the UK overseas territories of the Cayman Islands and British Virgin Islands.

"The places that you can hide are getting smaller and smaller," he said. "We are in advanced stages of discussions," he said of talks with the two territories. "They are in no doubt about what we expect."

Irish finance minister Michael Noonan said he expected the finance ministers to endorse a plan for a central authority for Europe's banks that has been developed in Brussels by national representatives to the EU.

''I think the big breakthrough today will be that we have now got a political agreement on the single supervisory mechanism,'' Noonan said on his way to the meetings on Friday. After that, he said, Ireland, which currently holds the six-month rotating presidency of the EU, will begin working to develop a policy on bank resolution.

The plan is to give the European Central Bank central oversight of all European banks, accompanied by a common bank resolution mechanism and a joint bailout fund. But the plan won't take effect before next year, as Noonan acknowledged Friday.

The finance ministers, at their meeting in Dublin, which continues today, will also consider extending the repayment schedules on bailout loans previously given to Ireland and Portugal. That would ease the burden of repayment, reduce the squeeze on government spending and potentially boost growth in both countries.

Jeroen Dijsselbloem, president of the Eurogroup of finance ministers from the 17 EU countries that use the euro, said extending the payment schedules was very important for those countries because it would help them get out of the constraints demanded by their respective bailout programmes in return for their bailout cash.

In addition, Noonan said that extending the repayment schedules might require the approval of Parliaments in some EU countries.

The announcement adds to pressure on Vienna to sign up to EU rules for the automatic exchange of information on bank depositors. It follows Luxembourg's decision this week to share foreign bank account details with EU governments from 2015, bringing it into line with all other member states barring one - Austria.

Earlier, however, Austrian finance minister Maria Fekter dismissed exchanges of information as an invasion of privacy and criticised other countries for failing to tackle what she called the real "hot spots" of money laundering.

"Austria is sticking to bank secrecy," Fekter told reporters, placing her country in a minority of one when discussions on the issue among 27 EU ministers gets fully under way today.

She attacked the Group of 20 top economies for not taking "any step to close the money laundering in all the islands like Cayman Islands, Virgin Islands or ... in Delaware".