Resolution scheme must not bail-out banks: ECB's Knot

PARIS Fri Nov 30, 2012 6:24am EST

PARIS (Reuters) - A future single European bank resolution scheme should impose losses on shareholders and bondholders instead of simply bailing-out lenders with large amounts of public money, ECB Governing Council member Klaas Knot said on Friday.

"The resolution fund does not necessarily have to be so large as the numbers I've seen floating around... That's built too much on the notion that the fund is there to bail out," the Dutch central banker told a conference in Paris.

"Resolution is much more about imposing losses shareholders, the debt-holders, and even the senior debt-holders," he said.

(Reporting By Leigh Thomas and Daniel Flynn; editing by Paul Carrel)

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Comments (1)
jcfl wrote:
wow – somone who actually makes sense is a refreshing breath of air indeed. part of shareholders and debtholders legal responsiblities is accepting the bad along with the good. it’s time for the bad.

Nov 30, 2012 9:11am EST  --  Report as abuse
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