ID :
22791
Mon, 10/06/2008 - 06:27
Auther :
Shortlink :
http://m.oananews.org//node/22791
The shortlink copeid
4 European nations agree to set up new body to supervise banks
London, Oct 5 (PTI) Britain, France, Germany and Italy have agreed to set up within the E.U. a body to supervise banks as part of their joint efforts to stem the spread of the financial turmoil, triggered by the U.S. sub-prime mortgage crisis, in Europe.
In a statement released after an emergency summit in
Paris to deal with the raging financial crisis, British Prime
Minister Gordon Brown, French President Nicolas Sarkozy,
German Chancellor Angela Merkel and Italian Prime Minister
Silvio Berlusconi said mechanisms should be established within
the European Union to oversee cross-border European financial
institutions and enhance international cooperation.
The four nations also agreed that should public support
be necessary for ailing financial institutions, it should
take place in "a framework which recognises adequate
protection of taxpayers' money, the responsibility of
managers, and shareholders to bear their share of the burden."
They welcomed the decision of the European Investment
Bank to mobilise 30 billion euros of support for small and
medium size European enterprises.
The talks, hurriedly held by Sarkozy, came amid signs
that the financial crisis that devastated Wall Street is
spilling into Europe.
The meeting also came a day after the U.S. Congress
approved a whopping USD 700 billion government bailout of the
battered financial industry.
The four European Group of Eight member nations also
agreed that the application of the Stability and Growth Pact,
which governs fiscal policies of E.U. member states, should
"reflect the current exceptional circumstances."
The pact requires E.U. member states to limit the size of
their budget deficit to less than 3 per cent of gross domestic
product, Kyodo news agency reported.
But the agreement suggests they will tolerate the deficit
of an E.U. member state breaching the 3 per cent of G.D.P.
threshold if it occurs as a result of the nationalisation of
failed financial institutions.
The four nations also pledged to "take all the necessary
measures" to ensure the soundness and stability of the
European banking and financial system.
After the outbreak of the financial turmoil, major
European governments have stepped in and bail out several
major banks, including Britain's Bradford & Bingley,
Belgian-Dutch Fortis, Belgium's Dexia, and Germany's Hypo Real
Estate.
In a statement released after an emergency summit in
Paris to deal with the raging financial crisis, British Prime
Minister Gordon Brown, French President Nicolas Sarkozy,
German Chancellor Angela Merkel and Italian Prime Minister
Silvio Berlusconi said mechanisms should be established within
the European Union to oversee cross-border European financial
institutions and enhance international cooperation.
The four nations also agreed that should public support
be necessary for ailing financial institutions, it should
take place in "a framework which recognises adequate
protection of taxpayers' money, the responsibility of
managers, and shareholders to bear their share of the burden."
They welcomed the decision of the European Investment
Bank to mobilise 30 billion euros of support for small and
medium size European enterprises.
The talks, hurriedly held by Sarkozy, came amid signs
that the financial crisis that devastated Wall Street is
spilling into Europe.
The meeting also came a day after the U.S. Congress
approved a whopping USD 700 billion government bailout of the
battered financial industry.
The four European Group of Eight member nations also
agreed that the application of the Stability and Growth Pact,
which governs fiscal policies of E.U. member states, should
"reflect the current exceptional circumstances."
The pact requires E.U. member states to limit the size of
their budget deficit to less than 3 per cent of gross domestic
product, Kyodo news agency reported.
But the agreement suggests they will tolerate the deficit
of an E.U. member state breaching the 3 per cent of G.D.P.
threshold if it occurs as a result of the nationalisation of
failed financial institutions.
The four nations also pledged to "take all the necessary
measures" to ensure the soundness and stability of the
European banking and financial system.
After the outbreak of the financial turmoil, major
European governments have stepped in and bail out several
major banks, including Britain's Bradford & Bingley,
Belgian-Dutch Fortis, Belgium's Dexia, and Germany's Hypo Real
Estate.
