Tuesday September 2, 2014 Search
Weather | Athens
29o C
23o C
News
Business
Comment
Life
Sports
Community
Survival Guide
Greek Edition
Finance ministers fall short of bank-crisis fund deal sought by ECB

By Rebecca Christie, Corina Ruhe & Ian Wishart

European Union finance ministers claimed “good progress” after talks in Brussels as they worked to break a deadlock on a euro-area bank-failure law urgently sought by the European Central Bank.

The EU is searching for a compromise on the Single Resolution Mechanism and an accompanying common fund to cover the cost of saving or closing banks. ECB President Mario Draghi last week warned that failure to reach a deal before May’s European Parliament elections would have severe consequences for the euro zone and its fledgling banking union.

Dutch Finance Minister Jeroen Dijsselbloem said no conclusions were reached on rules for decision making by the proposed bank-failure authority. The questions of how quickly to build up the fund, and when and how it could tap financial markets, also remain open. Ministers resume talks today.

“We will have to look for further strengthening of proposals” concerning the proposed fund’s liquidity, said Dijsselbloem, who leads the group of euro-area finance ministers. EU member states and the European Parliament want a deal by the end of March, he told reporters after the meeting.

German Finance Minister Wolfgang Schaeuble, whose nation has led resistance to the parliament’s demands, declined to comment after the meeting. French Finance Minister Pierre Moscovici said Germany wasn’t far from accepting a proposed eight-year timetable for building up the new fund.

The SRM is part of an EU effort to prevent future financial crises by pooling responsibility for euro-area banks. A blueprint put forward last year by Michel Barnier, the bloc’s financial-services chief, would create a central agency backed by a 55 billion-euro ($76 billion) fund financed from industry levies.

“This week is critical,” Barnier said in a statement after the meeting. “I believe that a compromise is within reach on the great majority of topics under discussion.”

Dijsselbloem said ministers were able to agree on some elements of the plan, such as how to assign burden-sharing fairly in cross-border failures that involve a bank’s home country and nations that host its subsidiaries. He said ministers also worked out a compromise on how the new plan will incorporate EU rules on when regulators can force bank creditors to take losses.

Ministers also debated how to handle national compartments that will exist within the fund during its start-up period, which could be as long as 10 years.

“There is the possibility of lending or borrowing between the compartments,” Dijsselbloem said. “That is a decision to be taken by the fund. Member states can object during the transitional period, but only under a limited number of conditions. Otherwise it’s simply at the board’s discretion.”

Negotiators for the European Parliament and EU member states have made scant progress on a compromise text of the SRM bill, with time running out before the assembly adjourns for elections in May. The two sides made proposals late last year, and both must approve any final legislation for it to enter into force.

The next round of negotiations between parliament and Greece, which holds the EU’s rotating presidency and represents the interests of member states, will be held on March 12.

The ECB assumes full oversight of euro-zone banks in November, and Draghi made clear that the central bank wants to work with a single resolution agency when lenders get into trouble. The SRM is part of an EU effort to prevent future financial crises by pooling responsibility for euro-area banks.

“If we do not have one SRM, the responsibilities for resolution will remain national, and so we will have a misalignment of responsibilities,” Draghi said on March 6.

Parliament negotiators said last week that they would make a “last attempt” to broker a deal with Greece, which holds the EU’s rotating presidency and represents the interests of member states in the talks. Greece has set a March 26 deadline for an agreement.

“We cannot sign off on a deal which establishes a mechanism which is unfit for purpose,” Elisa Ferreira, the parliament’s chief negotiator on the SRM, said on March 5. “A potentially unworkable resolution system will jeopardize banking union and leave taxpayers exposed.”

[Bloomberg]

ekathimerini.com , Tuesday March 11, 2014 (10:59)  
Deadline looms for struggling Cyprus Airways
Bank of Cyprus expects to relist on Nicosia, Athens exchanges
Bank concerns lead to fresh losses on bourse
Greece needs private debt overhaul, Piraeus Bank CEO says
Nicosia disappointed at Erdogan´s two-state solution comments
One day after Recep Tayyip Erdogan pressed for a two-state solution on Cyprus, President Nicos Anastasiades on Tuesday expressed disappointment over comments made by the new Turkish presiden...
Giorgos Stylios named new deputy education minister
New Democracy MP Giorgos Stylios has been appointed deputy education minister after Costas Koukodimos resigned on Monday, citing personal reasons. Stylios, who was elected to Parliament with...
Inside News
Grateful Saviola thanks Olympiakos, joins Verona
Former Argentina international Javier Saviola has thanked Greek champions Olympiakos for the "beautiful moments" during his season-long stint in Greece as he left the club to join Serie A ou...
SOCCER
Greece defender Papadopoulos fires parting shot at Michel
International defender Avraam Papadopoulos suddenly quit Olympiakos on Monday to join Turkish club Trabzonspor, and fired a parting shot at Olympiakos manager Michel putting the blame on the...
Inside Sports
COMMENTARY
Politicized archaeology
Let us suppose that archaeologists discover that the tomb uncovered in Amphipolis was not the resting place of Roxana or Nearchos, but of Alexander the Great. Let us assume, that is, that ar...
EDITORIAL
Moderating expectations
Politics is, to a great extent, all about managing expectations, and anyone who raises that bar too high or too fast is at serious risk of disappointing and losing the people’s favor. In a c...
Inside Comment
SPONSORED LINK: FinanzNachrichten.de
SPONSORED LINK: BestPrice.gr
 RECENT NEWS
1. Deadline looms for struggling Cyprus Airways
2. Bank of Cyprus expects to relist on Nicosia, Athens exchanges
3. Nicosia disappointed at Erdogan´s two-state solution comments
4. Giorgos Stylios named new deputy education minister
5. Greek singer-songwriter Antonis Vardis dies aged 66
6. Red tape cut in application process for Greek ID cards
more news
Today
This Week
1. Politicized archaeology
2. Rain and storms with hail expected in many parts of Greece
3. Reforms to dominate Greek talks in Paris, debt relief talks later, says source
4. New committee formed to assess progress of deregulation in closed-shop professions
5. Moderating expectations
6. Trial over 2013 murder of pawn merchant starts in Athens
Today
This Week
1. Thessaloniki mayor Boutaris sworn in wearing yellow star amid Golden Dawn protests
2. The battle against progress
3. Attack on gay couple in Athens leaves one man needing surgery
4. Strong undersea quake occurs off island of Milos, felt in Athens
5. Hardouvelis, ECB executive discuss bank program, stress tests
6. Greek quest for debt relief faces hurdles in Paris
   Find us ...
  ... on
Twitter
     ... on Facebook   
About us  |  Subscriptions  |  Advertising  |  Contact us  |  Athens Plus  |  RSS  |   
Copyright © 2014, H KAΘHMEPINH All Rights Reserved.