European-wide bank supervision plans ruled out by Sweden
SWEDEN’S FINANCE MINISTER Anders Borg has ruled out any plans to place banks across the European Union under the supervision of the European Central Bank.
He called such moves “completely unacceptable” after a meeting with finance ministers and central bank governors in Cyprus earlier today.
He also warned that legislative proposals unveiled last week by the European Commission, due for adoption by the end of the year, would need “long and tough” negotiations to stand a chance.
“There is a large number of countries that are not members of the eurozone that find this solution unacceptable.”
Sweden is a member of the EU but does not use the single currency. “We cannot accept that the money of Swedish taxpayers is used to bail out foreign banks,” added Borg.
The whole idea that we would be under the supervision of an institution where we have no voting rights, where (spending decisions on) our taxpayers’ money could depend on decisions taken by an institution where we have no influence, is completely unacceptable.
The rules governing new EU-wide bank supervision are meant to be fixed by the turn of the year, but already face obstacles including a German-expressed need to establish a related resolution fund for winding down broken banks.
Germany wants the ECB to focus on the so-called “too-big-to-fail” banks whose failure could wreck the system. However, President of the EC José Manuel Barroso has argued that small banks can prove just as fatal when they fail.