Push for a common savings insurance

European Commission President Jean-Claude Juncker announced on Wednesday a new push to guarantee the money EU citizens have deposited in their bank accounts, even when financial institutions fail.

A common European bank deposit insurance system is "urgently needed" to replace various national savings protection schemes, Juncker said in his State of the Union speech in Strasbourg.

"What we need is a more European system, disconnected from the purses of individual member states, so that citizens can be one hundred percent sure their savings are safe," he said.

He proposed a scheme that would legally guarantee a customer's savings account in amounts up to 100,000 euros ($111,525) in case of a bank failure.

Although consensus has not yet been reached on Europeanizing deposit insurance, the Commission expects to unveil a legislative proposal before the end of the year.

Germany in the past had resisted any moves to establish a common European deposit guarantee fund. The country's Ministry of Finance and savings banks remain skeptical of such a move, worrying that financial reserves that German savers have built up over the years could be drained away, if national schemes are replaced with a common European deposit insurance fund.

el/nz (dpa, European Commission)