19 June 2013

Schäuble fights against EU resolution authority

Translated from the German

German Finance Minister Schäuble said that a single eurozone bank resolution mechanism would breach the German constitution, and that if necessary he would be "forced to appeal to the European Court of Justice". Schäuble said that from a German perspective, the EU Treaty did not cover the establishment of such an authority. He had warned Commissioner Michel Barnier not to make such a proposal, he elaborated. If the worse came to the worst, he would have to appeal to the European Court of Justice. Schäuble instead reiterated his demand for a two-stage approach, under which first a network of national resolution authorities would be established, followed then by a treaty change.

Schäuble also turned against the idea of establishing a European deposit insurance. Although this was not officially planned at the moment, 'fantasies' in that direction existed among his colleagues, he said. 

Speaking to bank representatives, he also called for a strengthening of the securitisation market. "The securitisation market needs to get going, but with the help of the ECB", he said. He also expressed his strong support for the continued "diversification" in the German banking sector.

In his role as president of the Association of Private Banks (BdB), Deutsche Bank co-CEO Jürgen Fitschen made a surprisingly strong argument in favour of a European deposit insurance. With the common goal of driving Europe forwards, Germany should not give the cold shoulder to its European partners, he said. He was aware that many people were uneasy about the idea of a common deposit liability in Europe. But it would be wrong to reject the idea outright, he said.

Full article (in German)

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