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EU Leaders to Create Financial Regulatory Body

European leaders ended a two-day summit Friday with agreements to create a financial regulatory body and to back European Commission President Jose Manuel Barroso's bid for another term in office.

The agreement to toughen financial oversight came only after European Union leaders managed to overcome British fears that European supervisors would be dictating terms to national banks and other financial bodies.

As he outlined the main achievement of the Brussels summit to reporters, Britain's Prime Minister Gordon Brown said cross-border financial supervision was critical and the deal had not undermined national interests.

"It does not change the relationship between the European Union and its member states," he said. "The protocol clarifies but does not change the content or the advocation of the [positions] of the Lisbon Treaty and all these words are stated specifically in the decision that is issued today."

But analysts say the EU regulatory deal is not as far-reaching as the ambitious overhaul proposed this week by President Barack Obama in a bid to ensure major financial crises can be avoided in the future.

As expected, leaders of the 27-member block also threw their support behind Jose Manuel Barroso's bid for another term as president of the European Commission, the EU's executive arm. Mr. Barroso is a former Portuguese prime minister.

"He has proved beyond doubt that he has the vision, the determination and the courage to lead Europe forward for the next five years. Europe is and will be a better and stronger Europe under his leadership," said the British prime minister.

Meanwhile, Ireland's Prime Minister Brian Cowen announced Irish voters would have a second chance to weigh in on the EU's Lisbon reform treaty in October. Voters rejected the pact in a referendum last year, but experts predict they may back it this time around. All EU countries must approve the treaty for it to go into effect.