Friday October 31, 2014 Search
Weather | Athens
18o C
13o 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)  
Eurozone inflation up, unemployment steady, Eurostat reports
Greek retail sales rise for third month in a row
Germany’s 10-year bonds decline before euro-area inflation data
Cyprus’s Georgiades bets on economy for Irish-style bailout exit
PSI victims protest in Athens, Thessaloniki
Holders of Greek state bonds staged a protest rally outside the Finance Ministry in Athens on Friday, demanding amends for their substantial losses after the PSI debt restructuring in 2012. ...
Archaeologists find underground vault in Amphipolis tomb
Archaeologists digging at a tomb dating to the era of Alexander the Great in ancient Amphipolis in northern Greece have unearthed an underground vault, the country's Culture Ministry said Fr...
Inside News
BASKETBALL
Obradovic watches Greens thrash his Fenerbahce
The second homecoming of former Panathinaikos coach Zeljko Obradovic, now at Fenerbahce, was not as emotional as last year’s, but it was certainly was the night of an emphatic triumph for th...
SOCCER
Berg returns to add spice to Panathinaikos´s Cup win
The second round of games for the group stage of the Greek Cup produced plenty of interesting games and results in midweek, but it still lags the upset potential that the knock-out stages of...
Inside Sports
COMMENTARY
The judiciary’s responsibility
The reform efforts over the past few years have begun to bear fruit. Greece has improved its standing in the World Bank’s Doing Business rankings, rising 48 positions from 2010 to 61st place...
EDITORIAL
Findings raise eyebrows
An investigation into money transferred to foreign banks by civil servants since 2010, when Greece’s brutal debt crisis erupted, has come up with some striking findings. The checks, which we...
Inside Comment
SPONSORED LINK: FinanzNachrichten.de
SPONSORED LINK: BestPrice.gr
 RECENT NEWS
1. PSI victims protest in Athens, Thessaloniki
2. Archaeologists find underground vault in Amphipolis tomb
3. Eurozone inflation up, unemployment steady, Eurostat reports
4. Nikos Dendias appointed defense minister
5. Police clear apartment used by rebel monks
6. Greek retail sales rise for third month in a row
more news
Today
This Week
1. Man shot dead, woman injured in Vathis square attack
2. Cyprus’s Georgiades bets on economy for Irish-style bailout exit
3. Germany’s 10-year bonds decline before euro-area inflation data
4. New defense minister to be appointed without reshuffle
5. Greek retail sales rise for third month in a row
6. Traffic accidents rise 1.3 pct in August, year-on-year
Today
This Week
1. Austria’s creative bookkeeping beats Greece on secret debts
2. End of reason, end of humanity
3. Clean bill of health for Greek banks from stress tests
4. Samaras pledges action after flash floods in Athens
5. Eurobank, National Bank restructurings eliminate capital gap
6. Athens flood damage assessed, compensation payments to begin
   Find us ...
  ... on
Twitter
     ... on Facebook   
About us  |  Subscriptions  |  Advertising  |  Contact us  |  Athens Plus  |  RSS  |   
Copyright © 2014, H KAΘHMEPINH All Rights Reserved.