July 14, 2015 / 3:20 PM / 2 years ago

ECB's Mersch says ESM credit line could help bank resolution fund

FRANKFURT (Reuters) - A credit line from the European Stability Mechanism to a European resolution fund for banks would help complete the region’s banking union, a policy setter at the European Central Bank said on Tuesday.

Yves Mersch, Member of the Executive Board of the European Central Bank presents an oversized newly unveiled 10 euro note at the headquarters of the European Central Bank (ECB) in Frankfurt, January 13, 2014. REUTERS/Ralph Orlowski

Yves Mersch, who sits on the ECB’s executive board, said that the resolution fund, designed to deal with the costs of closing or salvaging troubled banks, could benefit from the backing of the European Stability Mechanism.

Urging a “quick agreement about a bridge financing for the resolution fund”, Mersch told an audience in Frankfurt: “One option would be a line of credit from the European Stability Mechanism (ESM).”

Reporting By John O'Donnell; editing by Francesco Canepa

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