November 4, 2019 / 9:00 PM / 11 days ago

More bank buffers may be needed in euro zone: ECB

FRANKFURT, Nov 6 (Reuters) - Euro zone bank regulators should consider forcing banks to build bigger capital buffers as protection against a downturn, European Central Bank Vice President Luis de Guindos said on Wednesday.

“Even if we consider the level of capital to be appropriate, there still seems to be scope to have a higher share of capital in the form of releasable buffers,” de Guindos told a bank supervision conference.

He argued that a countercyclical buffer, built up during more prosperous times, could be released during periods of strain and this may prevent a credit crunch, which usually aggravates downturns. (Reporting by Balazs Koranyi; Editing by Catherine Evans)

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