Cost of Bank Closure to be Shared through EZ

The cost of closing down a euro zone bank will initially be borne almost fully by its home country, but the obligations of euro zone partners will gradually rise to be shared equitably after 10 years, under the terms of an EU proposal seen by Reuters on Saturday.

The proposal, prepared by Lithuania which holds the rotating presidency of the European Union, will be discussed at an extraordinary meeting of senior EU officials on Monday, December 16.

After a financial storm that toppled banks and dragged down states from Ireland to Spain, countries are considering a fresh blueprint outlining what to do when a bank fails, a critical second pillar of a wider reform dubbed “banking union”.

CNBC

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