EU Bail-Ins Coming As Germany OKs Depositor Bail-In

Monday, July 14, 2014
By Paul Martin

GoldCore
GoldSeek.com
Monday, 14 July 2014

Germany Oks Bail-ins
BERLIN–Germany’s cabinet Wednesday approved plans to force creditors into propping up struggling banks beginning in 2015, one year earlier than required under European-wide plans that set rules for failing financial institutions.

The new bail-in rules are part of a package of German legislation on the European banking union–an ambitious project to centralize bank supervision in the euro zone and, when banks fail, to organize their rescue or winding-up at a European level

Germany’s new bail-in rules
BERLIN—Germany plans to force creditors into propping up struggling banks beginning in 2015, one year earlier than required under European-wide plans that set rules for failing financial institutions, according to a senior German finance ministry official.

From next year, struggling bank creditors, in addition to shareholders, will have to help financial institutions, covering up to 8% of liabilities, before the banks can tap Germany’s financial markets stabilization fund SoFFin, said the official, who declined to be identified.

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