Failing banks: no EU agreement yet

The EPP Group has warned against weakening the new rules for failing banks by the Council. Corien Wortmann-Kool, Vice-Chairwoman of the EPP Group, today reiterated the need for a Single Resolution Mechanism after Member States concluded their position yesterday evening.

"We need one effective and single mechanism to resolve failing banks in Europe in an equal way, independent from the Member State in which they are located", Wortmann-Kool commented. "This applies to both the use of resolution tools such as the bailing in of creditors and bondholders, but also with regard to the use of the resolution fund."

"Giving more powers to the national authorities as proposed by the Council will undermine the ability of the Resolution Board to act swiftly and will lead to more costly solutions in the end."

Corien Wortmann-Kool does foresee, however, negotiations with the Council on a final agreement: "The Parliament's position that was adopted last Tuesday clearly aims at a single system for resolving failing banks. The European Parliament is co-legislator and should be fully involved in the negotiations, including for the design and governance of the fund that will be financed by the banks."

Jean-Paul Gauzès MEP, EPP Group Coordinator in the European Parliament’s Economic and Monetary Affairs Committee, stated: "I am happy with the agreement reached last night on the setting-up of a mechanism to take care of banks facing difficulties in the Eurozone".

"The Single Resolution Mechanism for failed banks is indispensable for finalising the banking union and making sure that taxpayers don't have to pay to save banks in difficulty. It should make it possible for Europe to make progress in competitiveness, growth and jobs", Gauzès explained. "Practical modalities for the implementation of this mechanism now need to be discussed between the European Parliament and the Council."

The EPP Group will do its utmost to make sure that negotiations are finalised before the end of the mandate.