Ireland and other countries could foot bill for future bank rescues
IRELAND and other countries could end up footing the bill for future bank rescues, unless a deal is agreed to share the costs, Finance Minister Michael Noonan has warned. Ireland is pushing for a European banking deal that includes using the euro zone's rescue fund to finance bank rescues, not national governments. Mr Noonan said that in his view the European Stability Mechanism (ESM), Europe’s bailout pot, should provide a financial backstop to the new European bank resolution mechanism - common rules setting out how problem banks will be shut or saved in future. Using the rescue fund will mean breaking the 'link between banks and sovereign' states, he said. Agreement on how bank rescues will be financed is one of the issues still to be decided as the euro area moves towards a so called banking union, the minister said. He was speaking today at a conference on the future of banking in Dublin. European Central Bank (ECB) Vice President Victor Constancio said banking union will help get to a situation where two businesses anywhere in Europe with similar credit standing should have equal access loans. End.