Brussels, 12/07/2016 (Agence Europe) - On Monday 11 and Tuesday 12 July, the European finance ministers stressed the importance of observing the framework of rules on the resolution and recovery of banking institutions when tackling the situation of the Italian banks.
“We established those rules coming out of a major banking crisis, only a few years ago, and we established banking union on the basis of those rules”, said the President of the Eurogroup, Jeroen Dijsselbloem.
According to the Wall Street Journal, the Italian government is planning to inject €40 billion into the banks, but has expressed concern at rules requiring investors, shareholders and unprotected depositors to make a contribution, the 'bail in'.
“I feel that the bail-in is a sound economic principle, it says basically that investors take profit in the good years and carry the loss in the bad”, Dijsselbloem explained. “Yes, it is possible for public money to be involved (in rescuing a bank), does this require a bail in? Yes, to some extent”, Dijsselbloem went on. The German finance minister, Wolfgang Schäuble, was quoted by the Wall Street Journal as saying that the bail-in rules have sufficient possibilities to react to all kinds of situations, including the protection of retail investors. (Original version in French by Élodie Lamer)