Stournaras wants banks to harmonize guarantees

The harmonization of national systems for the guarantee of bank deposits must move forward, Bank of Greece (BoG) Governor Yannis Stournaras told “Banking Resolution at Ten: Experiences and Open Issues,” an international conference on the 10-year experience from the resolution of the financial system, in Athens on Wednesday.

As the Greek central banker noted, “no bank should be allowed to pass on the cost of its own bad management to the taxpayer just because it is considered ‘too big to fail.’ However, the exit of a bank from the banking market should be carried out in a coordinated manner, should not disrupt the provision of critical functions, should not jeopardize the financial stability of the banking system overall, and should prevent an unnecessary loss of value.”

Referring to the reform of the bank resolution system concluded in recent years, Stournaras said that EU banks have become more secure through the efforts of the Single Resolution Mechanism, but this should not be cause to rest on one’s laurels.