BRUSSELS Jan 11 The head of the euro zone
banking watchdog said on Wednesday she had no concern about how
EU bank failure rules had been applied in the public rescue of
Italy's Banca Monte dei Paschi di Siena.
The Italian government and the EU supervisory authorities
"are doing a good job" in the Monte Paschi case, Single
Resolution Board chair Elke Koenig told a news conference.
The Italian government used a clause in EU rules on banking
liquidation to reduce losses on Monte Paschi's creditors when it
decided to rescue the ailing bank in December.
"I would not be concerned by that rule," Koenig said.
She added that the SRB, which is in charge of overseeing the
orderly liquidation of failing banks, "is closely following all
relevant developments in Italy and also in other member states".
The EU's bank liquidation rules have been operational since
2016 and are aimed at reducing taxpayers' costs in bank
Under the rules, a bank's creditors are required to bear
heavy losses, in a so-called 'bail-in', before the lender can be
bailed out with public money. But an exception to the rules
allows states to lower creditors' losses in extraordinary
(Reporting by Francesco Guarascio)