In this June 6, 2012 file picture the President of the European Central Bank, Mario Draghi, speaks in Frankfurt, Germany. THE CANADIAN PRESS/AP, dapd, Mario Vedder
June 21, 2012 - 10:54 AM
FRANKFURT - Europe's financial risk monitor, European Systemic Risk Board, has called for tough conditions to be attached to any public money used to bail out banks.
The European Systemic Risk Board is also arguing it's time to start winding up banks that are not viable.
The warning to put tough conditions on bank aid and to close down or sell off insolvent banks comes shortly ahead of an expected request from Spain for up to €100 billion in loans from the eurozone's bailout fund. Spain wants the money to bail out banks that suffered heavy losses on real etate loans.
The board said Wednesday that "systemic risk remains high" because of the government debt crisis. Debt loads are threatening Spain and Italy, while Greece, Portugal and Ireland have already needed bailouts.
News from © The Associated Press, 2012