FRANKFURT, July 21 Small banks should be
exempted from large contributions towards a planned bank
resolution fund, European Union experts have proposed in a
compromise move to make pan-European bailouts more palatable, a
document obtained by Reuters shows.
Lawmakers have worked on ways to make a 55 billion euro
bailout fund, known as the Single Resolution Mechanism (SRM),
more acceptable, after encountering opposition from countries
with a high proportion of small banks, including Germany.
Banks with liabilities of less than 300 million euros and
assets below 1 billion euros should be asked only to make small
contributions towards the bank fund, the expert group said.
A bank's contribution is determined on the basis of an
institution's total liabilities minus own funds and covered
deposits, the document showed.
The European Commission services' Note to the Expert Group
on Banking, Payments and Insurance on July 16 proposed
introducing a six-category system for classifying small banks
capping their annual contribution to the common bailout pot at
between 2,500 and 60,000 euros.
Germany had lobbied for all banks with assets below 500
million euros to be excluded from making any contribution to the
common fund while the European lawmakers lobbied against having
Germany's savings banks have criticised plans to include
small banks in any pan-European bailout mechanism, saying such a
system favoured large banks as smaller lenders were unlikely to
need a pan-European rescue.
(Reporting by Andreas Kröner; writing by Arno Schuetze and
Edward Taylor, editing by David Evans)