EU unveils plan to protect taxpayers from failing banks
Source: BBC News
Proposals designed to stop taxpayers' money being used to bail out failed banks will be unveiled by the European Commission later.
They aim to ensure losses are borne by bank shareholders and creditors and minimise costs for taxpayers.
It wants to prevent runs on banks in one country - such as Spain or Greece - pulling down the entire system.
A key goal is to make sure that essential everyday banking functions - such as cash machines - are kept going.
Read more: http://www.bbc.co.uk/news/business-18333240
boppers
(16,588 posts)If you have more than 200,000 USD in a bank, you don't deserve to keep it, anyways.
dipsydoodle
(42,239 posts)The rich would use electronic transfers leaving the poor to deal with it queuing at empty banks.
boppers
(16,588 posts)Hint: bad idea.
Jackpine Radical
(45,274 posts)boppers
(16,588 posts)MindMover
(5,016 posts)Flatulo
(5,005 posts)dipsydoodle
(42,239 posts)I only know that the UK does - £80000 for consumers and small businesses : I think. I would assume its up to each country and if that is the case, then in this instance , if the Greek government has no funds then what would they pay out from ?
muriel_volestrangler
(101,322 posts)That FAQ, from a couple of years ago, says an EU-wide (or Eurozone-wide) scheme would have advantages - bigger, so less likely that a bank failure could swamp it, less administrative overhead. So that may be part of the upcoming announcement.
dipsydoodle
(42,239 posts)with some aspects dated 2020.
Currently the 100,000 figure equates to our £80,000 whatever.
The subject does however leave the question where would the funds come from now in the cases of Spain and Greece ?
rootProbiscus
(38 posts)So the country starts its new Drachma life with a new currency and already a gigantic debt in the new currency.
But at least they can then print more and more new drachmas
And hyperinflation will not happen, the new drachma will hold at reasonable level - say 1,000,000,000 to the euro, very reasonable.
And it will return to parity when hyperinflation hits the euro 6 months later anyway.
It is all good fun isn't it!
Flatulo
(5,005 posts)for carrying around loose change.
muriel_volestrangler
(101,322 posts)The 2012 changes are about some other change that that particular release was about.
When the financial crisis hit in autumn 2008, Member States decided that the level of deposit protection should be gradually but quickly increased in the EU. A Directive adopted in March 2009 required coverage to be increased from a minimum of 20 000 to at least 50 000 by June 2010 and to a uniform level of 100 000 by the end of 2010. Today's proposal following an impact assessment on the move to 100 000 confirm the 100 000 figure.
On the basis of a coverage of 100 000, 95% of eligible accounts will be fully covered, 7% more than before the crisis.
dipsydoodle
(42,239 posts)Thanks.
Flatulo
(5,005 posts)at six or seven percent rate of return, there don't seem to be many takers.
In the US, the Fed can print money to re-capitalize banks, but I don't know if the ECB can do the same thing.
nineteen50
(1,187 posts)slave labor is all that is left