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On 30 May, at a news conference to present the European Commission’s annual report on the economies of the EU’s 27 member states, José Manuel Barroso announced that the creation of a banking union could be “a possibility” to provide support for the financial sector in the eurozone.

According to Austrian daily Der Standard, the Commission President indicated that this “banking union” could offer a single deposit guarantee scheme and integrated supervision of banks. The newspaper continues —

Barroso called for a future banking union that would provide the necessary guarantees to allow for the direct recapitalisation of financial institutions by the European Stability Mechanism (ESM) instead of channeling funds via loans to sovereigns or shareholders. [...] The ESM which is to come into force on 1st July will have a capacity of 700 billion euros. We will need a plan that provides us with time, said Barroso. Sharing the burden is the only way to restore investor confidence.