This extraordinarily large rescue package – equivalent to 13 per cent of the Union’s GDP, 10 per cent in guarantees – can only be understood as a necessary step for the stability of our banking and payment systems – and in this respect it has worked well.
This huge transfer of public resources effectively moved risk from banks’ books to governments’ accounts, tightening the links between them.
Policymakers need to consider:
The European Commission is directly involved in the restructuring of the banks that have received State support. Using the special crisis rules for State aid to banks introduced at the end of 2008, we have so far taken 39 decisions on restructuring, and 24 more banks are under restructuring processes as we speak.
The Commission has also approved national schemes in 20 EU countries. These schemes use an array of tools provided under the crisis regime; including capital injections, support for the divestment of impaired assets, and guarantees on banks’ liabilities. Therefore, we are using State aid control to maintain a level playing field in the market and, at the same time, to foster the restructuring of banks.
The conditionalities we imposed under these rules pursue three main goals:
-
firstly, safeguarding financial stability;
-
secondly, preserving the integrity of the internal market; and
-
thirdly, restructuring the beneficiaries of aid for long-term viability.
Full speech
© European Commission
Key
Hover over the blue highlighted
text to view the acronym meaning
Hover
over these icons for more information
Comments:
No Comments for this Article