A single regulator responsible for the oversight of banks across all 27 European Union countries could come into place as early as January 2013, according to reports.
The plan could be agreed at a European Council Meeting on 28 and 29 June in Brussels, the BBC has reported.
However, the British government has already voiced opposition to the idea of a single regulator and could opt out.
Meanwhile, it is also expected that a new bank bailout fund financed by a tax on financial institutions will also be announced, creating an EU-wide deposit guarantee scheme to protect savers in the event of a bank collapse.
A commission spokesman told the BBC that talks on the issues were "in the early stages", although some elements of the banking union could be introduced without changes to existing treaties.
'Important milestone' for group
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