Banking Stability
SteveF

Cyprus bail-out: savers will be raided to save euro in future crises, says eurozone chief

Savings accounts in Spain, Italy and other European countries will be raided if needed to preserve Europe’s single currency by propping up failing banks, a senior eurozone official has announced. … Ditching a three-year-old policy of protecting senior bondholders and large depositors, over €100,000, in banks, Mr Dijsselbloem argued that the lack of market contagion surrounding Cyprus showed that private investors could now be hit to pay for bad banking debts.

Maybe I’m missing something here, but isn’t this about the best way imaginable to make the large depositors uneasy about leaving their money in the bank? And lead by obvious steps to the bank failures he’s trying to avoid?

Comments

Banking Stability — 2 Comments

  1. It shows how desperate they are, and how vulnerable the Eutro banks are. They are willing to destroy all confidence in the banks for a short-term, temprary fix. And the idiots announced that this will be SOP in the future: Cyprus bail-out: savers will be raided to save euro in future crises, says eurozone chief

    Savings accounts in Spain, Italy and other European countries will be raided if needed to preserve Europe's single currency by propping up failing banks, a senior eurozone official has announced.

    All is proceeding disastrously as a result of their limited options: Expect These Eight Steps From The Government’s Playbook.