European Union banks are upset by proposals from 13 smaller EU states to boost the power of national supervisors in setting lenders' capital buffers against the risk of failure, a move that could increase banks costs.

New banking rules, proposed by the European Union executive last year, would lower the discretion of national watchdogs in setting the amount of capital that multinational banks have to hold in their subsidiaries to absorb losses.

In a document seen by Reuters, most eastern European states and other smaller EU states are urging changes to the proposed measures, Reuters writes. Read more.