Czech, Polish and Bulgarian officials have vented concerns over potential repercussions if Europe creates a banking union as envisioned by France, Italy or the European Commission . . . a unified bank oversight at the European level might lead to moral hazard and could strip countries of their ability to impose capital and asset flow limits and liquidity could be transferred from profitable subsidiaries to undercapitalised parental institutions . . . this could have a significant impact upon their domestic financial sectors since over 95% of the Czech and 65% of the Polish lending institutions are concentrated in foreign, mainly Western European, hand . . . almost 30% of the Bulgarian banking sector is owned by Greek financial institutions, with Italian and Hungarian institutions owning some of the largest lenders . . . Eastern European countries are concerned about losing their ability to icontrol capital outflows and can be expected to push for ‘safeguards’ for their financial sectors, such as limiting the proposed banking union to Eurozone countries . . . the threat of liquidity drainage is particularly salient in the case of Bulgaria, which has a large part of its banking sector owned by banks based in troubled economies . . . their opposition could further complicate progress at the ongoing European summit already beset with conflicting national interests.