Bail-Ins Coming – EU Gives Countries Two Months To Adopt Rules

Wednesday, June 3, 2015
By Paul Martin

By: GoldCore
GoldSeek.com
Wednesday, 3 June 2015

– 11 countries face legal action if bail-in rules are not enacted within two months
– Bail-in legislation aims at removing state responsibility when banks collapse
– Rules place burden on creditors – among whom depositors are counted
– Austria abolished bank deposit guarantee in April
– “Bail-in regimes” coming globally

The European Commission has ordered 11 EU countries to enact the Bank Recovery and Resolution Directive (BRRD) within two months or be hauled before the EU Court of Justice, according to a report from Reuters on Friday.

The news was not covered in other media despite the important risks and ramifications for depositors and savers throughout the EU and indeed internationally.

The article “EU regulators tell 11 countries to adopt bank bail-in rules” reported how 11 countries are under pressure from the EC and had yet “to fall in line”. The countries were Bulgaria, the Czech Republic, Lithuania, Malta, Poland, Romania, Sweden, Luxembourg, the Netherlands, France and Italy.

France and Italy are two countries who are regarded as having particularly fragile banking systems.

The rules, known as the Bank Recovery and Resolution Directive (BRRD), aim ostensibly, to shield taxpayers from the fall out of another banking crisis. Should such a crisis erupt governments will not be obliged to prop up the banks. At any rate most countries are far too deeply indebted to play such a role.

Instead, the burden is being placed on the creditors. As Reuters put it,

The rules seek to shield taxpayers from having to bail out troubled lenders, forcing creditors and shareholders to contribute to the rescue in a process known as “bail-in”.

The Rest…HERE

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