FRANKFURT — For European officials, it may have been an especially untimely – and embarrassing – example of political gridlock.

Their failure early Saturday to agree on a crucial pillar of the euro zone’s new banking architecture, despite 18 hours of haggling, came just as the world’s central bankers were about to blast politicians for exactly that kind of dithering.

The Bank for International Settlements, a group representing central banks including the Federal Reserve and the European Central Bank, on Sunday warned political leaders that they should not expect central banks’ cheap-money policy to hold the global economy together forever. The organization, based in Basel, Switzerland, said in its annual report that politicians should finally do their share of “the hard but essential work of adjustment.”

‘’Returning to stability and prosperity is a shared responsibility,’’ Jaime Caruana, general manager of the B.I.S., said Sunday in Basel, according to a text of his remarks. ‘’Monetary policy has done its part.’’

The report’s publication came a day after political leaders meeting in Luxembourg had just provided a vivid example of what the central bankers were complaining about. Despite debating well into the early morning hours Saturday, European Union finance ministers could not agree on new rules to lessen the chances that taxpayers will bear the burden if commercial banks collapse.

“We ran out of time,” Michael Noonan, the Irish finance minister, told reporters as he left the meeting at about 4 a.m. “There are still core issues outstanding, so we’ll need a full meeting next week, and there’s no guarantee it will reach conclusion.”

The message from the group in Basel was that central banks cannot enable such lack of action indefinitely. “The balance between costs and benefits is deteriorating,” Stephen Cecchetti, head of the monetary and economic department of the B.I.S., said in an interview, referring to central bank policies that have flooded the world with cheap money since the financial crisis began in 2008.

In fact, there are already clear signs of central bank retrenchment. Fed Chairman Ben S. Bernanke indicated last week that the American central bank was likely to wind down the purchases of bonds it has used to push down market interest rates. The European Central Bank seems to be running out of ways to stimulate the euro zone, and there is doubt about whether the Bank of Japan can maintain an ambitious policy to flood the economy with money and achieve a target of 2 percent inflation.

As long ago as last summer, the Europan bank president, Mario Draghi, was publicly lamenting the limits of the central bank’s ability to address the broader problems of the European economy and calling upon political leaders to pursue structural solutions.

Jörg Asmussen, a member of the policy-making executive board of the central bank, reiterated the point in a speech Sunday in Kiel, Germany. “The global reform agenda has lost momentum, as the sense of urgency imposed by the crisis has vanished,” he said.

But there did not seem to be any awareness of the limits of central bank forbearance among the 17 ministers in Luxembourg. Like students who have waited too long to get going on a term paper, the ministers pulled an all-nighter in a desperate attempt to complete their assignment — in this case, to establish a system meant to ensure that taxpayers never again have to pay so much for the mistakes of bankers.

The ministers have scheduled another meeting for Wednesday, a day before the leaders of the European Union’s 27 member states gather for a summit meeting in Brussels, their last scheduled meeting before the summer hiatus. The leaders have been expected to endorse the finance ministers’ decision — if there is one.

The 18-hour marathon was aimed at breaking the so-called doom loop, in which struggling governments go deeper into debt to save their banking systems, only to face sky-high borrowing costs. That vicious circle was largely the reason Ireland and Cyprus required international bailouts, while Spain has struggled to avoid being sucked into a similar vortex.

But since agreeing in principle last year to centralize bank supervision in the euro zone and create a system to wind down terminally ill banks, the finance ministers have been snagged on various issues, including how to share the cost.

Jack Ewing reported from Frankfurt and James Kanter from Luxembourg. Mark Scott contributed reporting from London.

Article source: http://www.nytimes.com/2013/06/24/business/global/central-banks-criticize-europe-for-political-gridlock-on-economy.html?partner=rss&emc=rss