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EU summit: Compromise deal on eurozone bank supervisor

19 October 2012 Last updated at 11:07 BST

EU leaders have agreed to set up a single eurozone banking supervisor - a major step towards a banking union.

A legislative framework is to be in place by 1 January next year, with the body starting work later in 2013. But there is likely to be further wrangling before the agreement is implemented.

The European Central Bank-led mechanism will have the power to intervene in any bank within the eurozone.

BBC Europe editor Gavin Hewitt reports.