Merkel says EU banking deal secures German interests

German Chancellor Angela Merkel hailed on Thursday an agreement clinched by EU finance ministers on giving the European Central Bank new powers to supervise euro zone banks and said Germany's key demands had been met.

"The importance of the deal cannot be too highly assessed... We succeeded in securing Germany's key demands," Merkel told the lower house of parliament, the Bundestag.

Merkel also praised Greece's reform efforts and said she expected euro zone ministers on Thursday to approve the payment of a next tranche of loans for the crisis-racked country.

(Reporting by Sarah Marsh and Madeline Chambers, writing by Gareth Jones)