Germany’s cabinet has approved draft laws that effectively give the go-ahead to Europe’s plans for banking union – its main confidence-building response to the financial sector crisis.
With the laws, Germany is pressing ahead of EU requirements in protecting German taxpayers from having to foot the bill when a bank gets into trouble. Instead, in a process dubbed a “bail-in”, creditors and owners will have to take losses from 2015, a year before EU rules take effect. Continue reading
The European Union must be able to wind down failing banks within a weekend, according to Sabine Lautenschlaeger, Germany’s candidate for a vacant seat on the European Central Bank’s governing council.
“So we need a structure where it is possible to start a resolution on Friday night and to finish it on Monday morning at 1 o’clock because then Japan, Tokyo opens. That is a really important requirement,” Lautenschlaeger told a European parliament committee in Strasbourg. Continue reading