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refused to renew its program because of poor banking oversight.
Germany also holds trump cards in crucial European discussions on banking oversight.
On Tuesday, European Union finance ministers will meet in Brussels to discuss banking oversight.
The government and the regulators have had two broad approaches to banking oversight during the crisis and its aftermath.
European banking oversight, at least of systemic institutions, should be entrusted to a Europe-wide supervisor modelled on America's FDIC.
But amid the flurry of questions over sovereign debt, banking oversight and fiscal responsibility, another kind of austerity is taking hold in European households — the nutritional kind.
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From environmental protection to bank oversight, the rule book has steadily thickened in recent years.
But former regulators said that the pay reviews represented a more interventionist approach to bank oversight.
Someday, those powers might include running a federal system of bank oversight with Europe-wide deposit insurance.
Mr. Bernanke also said he did not think conflicts existed between the Fed's consumer protection and bank oversight roles.
In a surprise appointment, Hector Sants, the chief executive of the authority, will move to the Bank of England and be in charge of the bank oversight unit.
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