Banks, Euro Zone | featured news

The euro zone economy shows little sign of recovering before the year-end despite an easing of financial market conditions, European Central Bank Mario Draghi said on Thursday after interest rates were left at a record low.

Britain is pushing for changes to a proposed euro zone banking union to dilute the power of the European Central Bank, EU officials said, potentially hampering efforts to build the infrastructure urgently needed to underpin the euro.

The Spanish economy is falling deeper into recession and depositors are pulling their money out of the banks, figures published on Tuesday showed, while the country's most economically important region, Catalonia, said it needed a major rescue from Madrid.

European leaders reached a "breakthrough" deal early Friday to ease the recapitalization of struggling banks that should help draw the eurozone back from the brink of a gathering crisis. Under the deal, European leaders agreed to create a single supervisory body to oversee the eurozone's banks which could use the single currency area's rescue funds, the European Financial Stability Facility or European Stability Mechanism, to aid banks directly without adding to governments' debt.

The central bank also said it would maintain its program of low-interest lending to euro-zone banks through the end of the year.