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saving Mps must be carefully weighed. “For the measures decided by the Italian government, the banks must be financially healthy to the core. The funds may not be used to cover losses that are already covered”. This was stated by the president of the Bundesbank, Jens Weidmann, in an interview to Bild as reported by the agency Bloomberg.
According to Weidmann, the risk is that there is a strong economic turbulence. “All of this needs to be carefully examined”.
the president of The Bundesbank, Jens Weidmann, has invited you to analyse in detail the situation of Monte dei Paschi di Siena and pointed out that the use of public funds to save the banks is to be considered only as a “last resort”. The new rules at the european level “give priority to protecting the taxpayers,” while investors are the ones who must “take responsibility,” said Weidmann.
“The public money should only be contemplated as a last resource, for this the bar is placed very high,” continued the president of the German central bank, warns that, in the case of the Italian bank, “there are many open questions”. Before approving a rescue plan must be “carefully assessed” if the core of the bank is “economically healthy”, he adds, and ensure that the money injected is not to be used “to cover the losses predictable.”
Other concerns are expressed by Isabel Schnabel, a member of the Sachverstaendigenrat, the Council of Economic Experts of Germany, the so-called “Five wise men”, who says: “an extensive clean-up of the Italian banking system is necessary and must be made promptly. The insolvent banks must be closed, the banks vital must be ricapitalizzate. Suffering should be removed from the financial statements of banks”. According to Weidmann, the risk is that there is a strong turbulence. “All of this needs to be carefully examined”. Weidmann explains that the european rules will “serve to protect the taxpayers and giving responsibility to the investors. The state funds are as a last resource.”
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