The European Union will make a fresh attempt on Wednesday to share out the costs of future bank failures, starting a regime to spare taxpayers further bailouts and maintain momentum to integrate the bloc's crisis response.
Finance ministers from the bloc's 27 countries will gather on Wednesday evening for what will be tough talks, after the all-night negotiations in Luxembourg last weekend that broke down over a Franco-German split on how to impose losses.
France and Germany are split over how much leeway governments should have when applying EU rules that set out how shareholders, bondholders and depositors with more than 100,000 euros ($132,000) should share the burden of bank collapses.
Although there is no deadline for an agreement, ministers are meeting on the eve of an EU leaders' summit in Brussels and are under pressure to show they are tackling Europe's banking and public debt crisis.
Forcing losses on big savers, first done in Cyprus's bailout in March, would mark a dramatic change in how Europe deals with troubled banks, having previously relied on taxpayer money for financial rescues.
"Those who make risk-bearing investments in the financial sector also should face those risks if it goes wrong," Dutch Finance Minister Jeroen Dijsselbloem told local television before the talks.
The European Union spent the equivalent of a third of its economic output on saving its banks between 2008 and 2011, using taxpayer cash but struggling to contain the crisis and - in the case of Ireland - almost bankrupting the country.
Unlike the United States, which moved swiftly to deal with its sickly banks after the 2008/2009 financial crisis, Europe has been reluctant to close banks whose credit is crucial to the economy and with whom governments have close political ties.
"Europe hasn't covered itself in glory," said Karl Whelan, an economist with University College Dublin. "The scale of banking problems was more quickly accepted in the United States. But in Europe they swept it under the carpet."
However, things could change for the 17-nation euro zone under a new system of supervision led by the European Central Bank, which will run checks on banks under its watch next year. If agreed in time, the new EU law under discussion could be used as the blueprint for closing or salvaging banks found to be ailing or bankrupt in the ECB's tests.
The ECB's new supervisory role is part of a project called banking union which aims to supervise, control and support banks to rebuild confidence in the euro zone.
Binding the euro zone more tightly together to underpin the currency union is tortuous, however.
France is arguing that the new EU rules should allow countries more leeway to decide how banks' creditors are dealt with. Germany is pushing for stricter rules in which everyone has to follow an agreed, EU standard.
"For France, this is about allowing the euro zone's bailout fund to be used when banks fail," said one EU diplomat involved in the discussions. "That is not the way Germany sees it."
Whatever deal they strike will be critical in determining how Europe copes with the billions of euros of bank loans that may go unpaid if the bloc fails to end economic stagnation.
"This is not just theoretical," said one EU official with knowledge of the issue. "Everyone knows there is a black hole in Europe's banks."