| LONDON, March 22
LONDON, March 22 Several European banks are
being closely monitored by the agency responsible for closing
lenders which go bust in the euro zone, but none are failing or
about to fail, the head of the Single Resolution Board (SRB)
said on Wednesday.
Elke Koenig did not mention any EU country by name but told
the European Parliament's economic affairs committee the SRB was
studying a number of banks in "shaky waters".
Since the 2007-09 financial crisis, the EU has adopted rules
to shield taxpayers from having to bail out lender again and
attention in the single currency bloc has been focused on
Italy's plans to bail out two regional banks.
This has posed a dilemma for European regulators who are
still considering whether another, bigger Italian lender, Monte
dei Paschi, qualifies for state aid.
"So far we are in a position that we have to conclude that
banks might be having... quite some challenges ahead of them,
but they are not failing or likely to fail," Koenig said.
German Green Party lawmaker Sven Giegold said there were
doubts that the European Central Bank (ECB), which supervises
euro zone lenders on a day-to-day basis, was being tough enough
in dealing with banks struggling with poorly performing loans.
Italian lenders in particular are burdened by large amounts
of so-called non-performing loans.
Koenig declined to comment on individual banks, but said:
"There are a number of situations where we have a very close
eye on... It's a number of cases. It's not just one or two."
Earlier she said most banks across the sector were not in
such a position that their failure would endanger financial
Koenig also called for banks to be given time to issue debt
that can be written down to replenish capital that has been
burnt out in a crisis, and thus shield taxpayers.
The biggest banks, such as Deutsche Bank, HSBC, and BNP
Paribas must begin building up this debt from 2019.
However, the total shortfall for euro zone lenders is
between 100 and 200 billion euros, and the bloc's European
Banking Authority has said markets won't be able to absorb such
amounts of new debt issuance quickly.
"There needs to be sufficient time," Koenig said.
(Editing by Alexander Smith)