The British Bankers’ Association (BBA) has issued a short press statement concerning the European Commission’s proposal on bank resolution funds.
The BBA argues that at the moment it cannot support the idea of an EU wide tax or levy to pay into a pan-European fund. At present too many important questions are unanswered. For instance why should the banks in one country pay for the problems of banks in another?
Instead the BBA believes that the EU should be considering more constructive steps. The BBA states that each country should strengthen its regulation and supervision. Each country needs to put in place arrangements so that if intervention is required, it is paid for by the industry and depositors are protected. The BBA also states that more work is required on options such as those proposed by the Institute for International Finance on bank recovery and resolution plans which would further protect economies and tax payers.