Skip to main content
The Globe and Mail
Get full access to globeandmail.com
Support quality journalism
Just $1.99 per week for the first 24weeks
Just $1.99 per week for the first 24weeks
The Globe and Mail
Support quality journalism
Get full access to globeandmail.com
Globe and Mail website displayed on various devices
Just$1.99
per week
for the first 24weeks

var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(select.open)}function setPanelState(o){dom.root.classList[o?"add":"remove"](select.open),dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){console.log("scroll");var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))}pencilInit(".js-sub-pencil",!1);

Britain’s Financial Secretary Greg Clark denied that Britain was becoming isolated by adopting a more confrontational stance in the EU.

ANDREW WINNING/REUTERS

Great Britain and other European countries have deep concerns about a banking union in the euro zone, although there are signs of a compromise to limit the powers of the European Central Bank in countries outside the euro, a British minister says.

Britain's Financial Services Minister Greg Clark said in an interview on Tuesday that efforts to help the 17-country euro zone and its banks recover from economic crisis must not come at the expense of the wider European Union market, which includes countries such as Britain and Sweden that do not use the euro.

The blunt warning from Britain's EU negotiator comes ahead of Thursday's summit of the 27-country EU's leaders, when they will seek to make progress on the disputed plan that would make the ECB the supervisor for all euro zone lenders.

Story continues below advertisement

Asked what Britain saw as the main stumbling block, Mr. Clark said: "In terms of the current proposals, the possibility of the euro zone, through the ECB, to in effect dominate the arrangements is something that gives us very deep concern, and not just us but other countries as well."

Britain has already had talks with other non-euro-zone EU member countries about introducing safeguards to stop the single currency area imposing rules on all of Europe.

"The indications are that these concerns are listened to and are being taken seriously," Mr. Clark said.

The clash comes at a time when Britain's Conservative Prime Minister David Cameron, who will attend Thursday's summit, is under pressure from an influential anti-EU wing of his own party to dilute the influence of Brussels.

Mr. Cameron has promised to negotiate a new settlement with the EU and put it to British voters in a referendum.

Mr. Clark, a Cambridge-educated economist with a doctorate from the London School of Economics, denied that Britain was becoming isolated by adopting a more confrontational stance in the EU after the government said on Monday it would opt out of the bloc's justice rules.

"There is no difficulty there. It does not constitute a battle," the 45-year-old minister said. "I don't see it in head-to-head terms."

Story continues below advertisement

But any compromise on the banking union will have to respect the 20-year-old single market, which allows firms from any member country to do business across Europe unhindered, he said.

Mr. Clark told a Thomson Reuters Newsmaker event that Britain's new Financial Conduct Authority watchdog, which will be formally in place early in 2013, should urgently encourage more banks to enter Britain's market, where just four lenders have 80 per cent of consumer accounts.

Last week, hopes for more competition were dashed when Spain's Banco Santander SA abruptly ended a deal to buy over 300 branches from Royal Bank of Scotland, which was bailed out by taxpayers at the height of the financial crisis.

As part of its bailout terms, RBS is required by the European Commission to sell the branches by the end of 2013.

Mr. Clark told Reuters it was too early to say whether Britain would have to ask Brussels for more time.

"Certainly they [RBS] have not approached us yet, to my knowledge, for us to approach the Commission for any extension," he said.

Story continues below advertisement

RBS is also expected to be fined for its part in market manipulation of an interest rate benchmark known as Libor (the London interbank offered rate), a scandal which has already led to a record fine for rival Barclays PLC.

Mr. Clark said the decision on when to settle had to be left to individual banks but the government would say later this week how the law will be changed to reform how Libor is governed and set.

"There is an urgent imperative and we will do everything that we can to change what needs to be changed as quickly as can possibly be done," he said.

Report an error
Tickers mentioned in this story
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed.

Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies