Gradual move towards deposit protection
The EU Commission has presented a plan for the gradual introduction of a European Deposit Insurance Scheme (Edis), the last step on the way to a banking union. Introducing the scheme slower than originally planned is meant to dispel doubts, particularly on the part of Germany. What does Europe's press think of the proposal?
First finalise the banking union
It's a good thing that the EU Commission is not rushing into reforming the Eurozone, Le Monde writes in praise:
“Displaying common sense, the European Commission sought on Wednesday to achieve an agreement backed by all sides by pointing to a basic truth: you shouldn't put the cart before the horse. Before launching into new institutional reforms for the Eurozone, perhaps it would be better to finish the projects that have already been started. In other words those concerning the banking union which are indispensable in the context of the persistent fragility of certain banks. What's also lacking to complete this construction is a European mechanism for guaranteeing bank deposits. The Commission is right: finalising the banking union is a precondition for any further reform of the Eurozone.”
Berlin still hitting the brakes
Il Sole 24 Ore sees the EU Commission's proposal as a compromise and complains that Germany is blocking the creation of a banking union:
“Bank supervision is carried out at the EU level but the credit and financial risks will remain a national affair at least until 2022. Then, perhaps, we'll be able to say we have a pan-European deposit insurance scheme. The proposal made yesterday by the EU Commission looks like yet another watered-down compromise. An intermediate step is foreseen on the path to an EU deposit insurance scheme. The ESM would help out banks in crisis with loans which, however, must be repaid. The real risk-sharing has been postponed.”
No risk for Germany
Deutschlandfunk seeks to answer the objections raised by the German financial sector:
“The EU Commission has proposed to have joint deposit protection come into force only once it's certain that all participating banks have freed themselves from old burdens. ... It's now the task of responsible politicians to ensure that this premise is respected and that there's no tricks or cheating. After all, it wouldn't be the first time that happened in the history of the EU. The negotiations will be difficult and they're likely to drag on for some time. However, there can be no talk of abandoning the plans and leaving the field to those who take an overly simplistic view of the situation. Even if they wear the pinstripes of top bankers.”