Thursday November 27, 2014 Search
Weather | Athens
14o C
8o 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)  
Bank of Cyprus posts 76 million euro nine-month profit
ILO report warns of prolonged social crisis unless steps are taken in employment
Greek tobacco firm Papastratos planning 25-mln-euro investment
Bourse index recovered on Wednesday
Greece says EU/IMF bailout exit could be delayed for ´technical´ reasons
Greece may have to delay by a few days or weeks its planned exit from an EU/IMF bailout by the end of the year, the country's deputy prime minister said on Thursday, citing "technical reason...
Ship with 700 migrants safely towed to Greek coast
Officials say a broken-down smuggling ship carrying 700 men, women and children trying to emigrate to Europe has been safely towed to just off the southern Greek island of Crete. Authorities...
Inside News
SOCCER
Atletico drubs Olympiakos 4-0, leaving Reds with slim chances of CL qualification
Atletico Madrid avenged its 3-2 defeat in Piraeus in September with a 4-0 win over Olympiakos on Wednesday, meaning the Greek champion only has mathematical hopes left for a spot in the next...
SOCCER
Atletico eyes last 16 berth against Olympiakos
Greek champion Olympiakos faces a tough task if it is to prevent last season's beaten finalist Atletico Madrid sealing its passage into the last 16 of the Champions League at the Vicente Cal...
Inside Sports
COMMENTARY
Scraping together the 180 MPs will not be enough
Even if the coalition government was to scrape together the 180-MP majority it needs to elect a new President in the 300-seat House, skeptics say, what will change really? There is one evide...
EDITORIAL
Taking back what’s stolen
A large group of public prosecutors and state officials (coming from various departments) have been working on major corruption cases. Of course it is their duty to do so, yet their actions ...
Inside Comment
SPONSORED LINK: FinanzNachrichten.de
SPONSORED LINK: BestPrice.gr
 RECENT NEWS
1. Bank of Cyprus posts 76 million euro nine-month profit
2. Greece says EU/IMF bailout exit could be delayed for ´technical´ reasons
3. Ship with 700 migrants safely towed to Greek coast
4. ILO report warns of prolonged social crisis unless steps are taken in employment
5. Greek tobacco firm Papastratos planning 25-mln-euro investment
6. Independent Greeks MP to be questioned over bribery claims
more news
Today
This Week
1. Troika talks to continue after failure to wrap up negotiations in Paris
2. Greece scrambles to find food, shelter for 700 migrants on crippled ship
3. Chief suspect in Piraeus bar shooting arrested
4. Greek diplomat dies in fall under Thai train
5. Greek, German, Portuguese, Spanish debt to benefit most from ECB QE - ABN Amro
6. Bourse index recovered on Wednesday
Today
This Week
1. Give Greece a chance
2. Biden heads to Istanbul amid tension over Cyprus EEZ violation
3. Scientists expand excavation of ancient Amphipolis
4. Extremism from a bygone era
5. Piraeus nightclub shooting leaves 3 seriously injured
6. Cosco’s Greek unit adds multinational rail-freight client
   Find us ...
  ... on
Twitter
     ... on Facebook   
About us  |  Subscriptions  |  Advertising  |  Contact us  |  Athens Plus  |  RSS  |   
Copyright © 2014, H KAΘHMEPINH All Rights Reserved.