Angela Knight said: "There is universal agreement on the principle that if a bank gets into trouble it is not the taxpayer who should pay. Instead all countries must have arrangements in place so that their national authority can intervene, in good time, with the banking industry bearing the cost. This is what was put in place in the UK by last year’s Banking Act.
"At the moment we cannot support to idea of an EU-wide tax or levy to pay into a pan-European fund leaves. It many too many important questions unanswered.
"Why should the banks in one country pay for the problems of banks in another? As has been seen by the Greece crisis, what is essential is that each country must take its own actions and early.
"How could a large sum of money sitting dormant somewhere in Europe make economic sense? And how would it do anything other than help facilitate the next crisis? It would surely increase moral hazard by curtailing the consequences of a bank failure.
"There are more constructive steps the EU should be considering.
"Each country should strengthen its regulation and supervision. Each country creates an intervention authority (in the UK this is the Bank of England). And each country needs to put in place arrangements so that if intervention is required, then this is paid for by the industry and depositors are protected.
"Crucially, more work is required on options such as that proposed by the Institute for International Finance earlier this week on bank recovery plans and resolution plans which would protect even further both economies and taxpayers."
