The deal’s importance “cannot be appreciated highly enough,” Chancellor Angela Merkel told the Bundestag, the lower house of the German Parliament.
“Europe and the euro area are providing proof that they are able to meet the challenges they face,” François Hollande, the French president, said in a statement.
In another sign of renewed efforts to shore up the euro, finance ministers and international officials approved the release of further aid to Greece, including long-delayed payments and other aid totaling nearly €50 billion, or $65 billion, that is crucial for the government to avoid defaulting on its debts.
“The sacrifices of the Greek people have not been in vain,” Prime Minister Antonis Samaras said, referring to stringent austerity measures Greece had adopted in order to obtain the aid.
“Today is not only a new day for Greece, it is indeed a new day for Europe,” Mr. Samaras said in Brussels ahead of a two-day summit meeting of European leaders.
The agreement on new banking supervision would put between 100 and 200 major banks under the direct oversight of the European Central Bank, leaving thousands of smaller institutions to be overseen primarily by national regulators.
But E.U. finance ministers, who reached a deal after meeting for 14 hours late Wednesday and early Thursday, insisted that the E.C.B. would be able to take over supervision of any bank in the euro area at any time.
Mario Draghi, the president of the central bank, said the agreement “marks an important step towards a stable economic and monetary union, and toward further European integration.”
Mr. Draghi added that governments and the European Commission still had to work on the details of the supervision mechanism, which is to be fully operational by March 2014.
The system must also be approved by the European Parliament and national legislatures before it goes into effect.
The new system is intended to strengthen oversight of a sector that, under the supervision of national regulators, failed to prevent banks from accumulating so much debt that they put at risk the finances of euro zone states including Ireland and Spain, in turn threatening the future of the currency.
The agreement on banking supervision was expected to act as a springboard for European leaders to discuss later on Thursday steps leading to a broader banking union. Such measures would include a unified system, and perhaps shared resources, to ensure failing banks are closed in an orderly fashion. This would be followed, in time, by measures intended to reinforce economic and monetary union, including, possibly, the creation of a fund that could be used to shore up the economies of vulnerable members of the euro zone.
To win France’s agreement on the new banking supervisor, finance ministers agreed that only banks holding more than €30 billion in assets, or assets greater than 20 percent of their country’s gross domestic product, would be directly regulated by the E.C.B. Previously, France and the European Commission had asked that all 6,000 banks in the euro area should be closely regulated by the central bank.
Germany, facing pressure from a powerful domestic banking lobby trying to shield many small savings banks from closer scrutiny, had sought a reduced remit for the E.C.B. In the end, Germany agreed to allow the central bank to step in and take over supervision of any bank in the euro area at its discretion.
The Germans also had concerns that the central bank could be tempted to alter its decisions on monetary policy to make its supervisory job easier. As a compromise, Germany agreed that member states would be given greater scope than originally foreseen to challenge central bank decisions.
“We succeeded in securing Germany’s key demands,” Ms. Merkel said in Berlin. There would be a “clear separation” between the central bank’s responsibility for monetary policy and for oversight, she added.
Britain, which is not a member of the euro zone, had sought assurances that the new banking supervisor would not have influence over British banks operating abroad or banks operating in the City of London.
Britain agreed to a formula that should free it and other E.U. members outside the euro zone from most, but probably not all, rule-making by the E.C.B. These countries will also be able to challenge E.C.B. decisions on cross-border banking.
“The safeguards we have secured protect Britain’s interests and the integrity of the European single market,” said the chancellor of the Exchequer, George Osborne. “It shows that when Britain takes a tough stance but based on strong principle, Britain can win the argument and protect our interests.”
For countries including Spain and Ireland, the supervisor is a prerequisite for a new European bailout fund to provide aid directly to their troubled banks. That would allow those governments to avoid weighing down their national balance sheets with yet more debt..
But any direct recapitalization of banks is only likely to go ahead during 2014, once the supervisor is fully operating, and well after a German general election in October 2013. Still to be clarified is whether the aid could go to banks that have already run into trouble, or whether it would be used only to help lenders that falter in the future.
Providing direct support to banks is a sensitive matter for German taxpayers, who have grown weary of footing most of the bill for the euro zone’s bailouts.
Melissa Eddy contributed reporting from Berlin and Niki Kitsantonis from Athens.
