STOCKHOLM (Reuters) - Sweden is unlikely to join a proposed European Union banking union for the foreseeable future, but might not block its creation for other countries if certain safeguards are met, Finance Minister Anders Borg said on Tuesday.
The Nordic state has resisted plans to give the European Central Bank (ECB) power over its banks, fearing that would weaken domestic control and leave Swedish taxpayers to foot the bill for propping up banks in others parts of Europe.
“In our view, it is not likely that we will get enough influence and clarity on these issues that it will be on the cards that Sweden becomes a member of the banking union,” he told reporters on the sidelines of a parliament briefing.
Borg, speaking on the eve of a meeting of EU finance ministers on a banking union, said Sweden was concerned about voting rights in the European Banking Authority (EBA) if the ECB becomes the top regulator in the EU.
“Sweden can accept that the others go ahead if the voting right rules are sorted out. But we may end up in a situation where the conditions are not such that Sweden can vote yes.”
The centre-right finance minister said Sweden would push to secure the rights of countries which chose to remain outside the bank union. This would entail a demand for majority votes among both members of the new union and outsiders in decision-making.
“If we get a compromise on that point (voting rights) then we can also accept that others go further with bank supervision by the ECB,” he said.
“If we don’t get clarity on voting rights in the EBA we can also not accept the ECB decision.”
A thorny issue for Sweden in the talks on a union has been jurisdiction over the country’s banks - Nordea (NDA.ST), Handelsbanken (SHBa.ST), Swedbank (SWEDa.ST) and SEB (SEBa.ST) - some of which have large operations in euro zone countries.
Borg said he did not expect a Swedish decision to remain outside a banking union to have any significant impact on its financial system, borrowing costs for households or the ability of Swedish companies to raise financing.
Reporting by Niklas Pollard, Patrick Lannin and Johan Sennero