EU lawmaker Elisa Ferreira, who’s in charge of guiding the European Commission’s plan for a Single Resolution Mechanism through parliament, proposed the backstop as one of a raft of draft amendments to the bill. Loans would later be repaid by the fund, according to the text of the amendment on the EU’s website.
Barnier’s proposal includes a central fund equivalent to 1 per cent of government-insured deposits held by euro area banks. The Commission has estimated the size of the fund, to be financed by levies on banks, at €55 billion).
Ferreira, a socialist, has said the “public loan facility” is needed to protect the SRM’s “credibility” during the 10 years it will take to fill the common fund. Her proposal, or variations on it, has won support from centre-right lawmakers such as Jean-Paul Gauzès and Pablo Zalba Bidegain, as well as Sylvie Goulard, a liberal. “Especially as long as the Single Resolution Fund is not entirely funded, it is essential to establish a European public loan facility", Gauzès said in one of his proposed amendments. Any loan from the facility should be reimbursed from the bank-financed fund “within an agreed timeframe.”
Other requests include a bid by Auke Zijlstra, an EU lawmaker from the anti-euro Dutch Freedom Party, to have Barnier’s entire plan scrapped on grounds of illegality. “The proposal infringes upon national budgetary sovereignty, therefore it would require a treaty change in order for it to be legally submitted", according to one of Zijlstra’s amendments.
Other proposals include a push from some assembly members to specify that the SRM should be based in Frankfurt, Germany, and a bid to bulk up the target level of the central fund.
Full article
Amended report, 22.10.13
© Bloomberg
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