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ECB’s Constancio says break-up of euro zone “unthinkable"

Monday, December 19, 2011 - 05:05

Dec. 19 - Vitor Constancio, vice president of the European Central Bank, says a break-up of the euro zone would have such negative implications for Europe as a whole that it is unthinkable.

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The European Central Bank has warns that the risk to financial stability in the Euro zone has increased. Stoked about some of these risks I'm not joined by B token stunts you he's the vice president of the ECB. Missed that -- unsealed. That latest figures from the European banking authority calculate that banks need about 114. Billion euros for recapitalization. It's just enough considering the -- coming out and look. Yeah we think it is because in the sense. Often compilations that. Readers. And this several adverse assumptions. Debt and take care of did you ration this situation and we that high targets. For the typical ratio of banks. In these I hear it then it. The target to applause -- and -- -- normal implementation -- -- three so he's he's taking care of creating sufficient technical performance. To address. A possible. Did you ration. This two hours. -- Many on expecting it to the well some. And analysts. Entities that yes we we don't. As you know. We are still working on the scenario that there will be moderate positive grows throughout. Next year. Own -- Of course there on and he. The full costs. In the marketplace some of them showing that policy goal. Recession for the whole year. And when that we look at the warnings for -- through the European systemic risk board will well how it's an announcement on because they. Can we expect a fast public warning. I don't know I I I I cannot speak fluently SRB. So I did not anticipate to what might happen next Thursday group policy certainly the SRB's going to analyzed the situation as we have done. And really reached its own conclusions. How many it's not -- European banks are at serious risk of going under at the moment. Well. And that cannot be answered. This straight to a way in the sense that it would all depend. On. -- city is scenarios that may not in materialized. What we have been published today is RO. Indicate terror. All what -- called systemic risk. Which -- shows what he's the probability. Based on some market indicators. Office two banks. And failing. Seen the next two years. And that's probably -- increased. It's around 25 to sense that doesn't mean it's going to happen. He's just an indication open who agrees all deceased and racecar -- area. Two ease the pressure on banks that the UC BS -- unlocked and to increase liquidity. And this Wednesday we both TP CB's finest three year you know and have you got any indication on how strong demand will be for this. No we don't have. An indication -- it's you know. Certainly the banks to. No. In anticipation what -- Leo -- Two and Google sealed and there aren't as you know many many full costs. In the market. Showing a broad broad range of possibilities. Use what you expect yourself. Well it's it's difficult of course banks have -- that. The opportunity to found themselves for three years. Which is I think. Important for them in particular because they face it. Very significant to be financing needs already in the first quarter of next year. So. Yeah I would expect that they will come not in the significant amounts but I cannot put the figures -- it. Now I know that you do not share the intention aren't the scenario. That they could be a potential break out of the year is saying. Nonetheless. Speaking hypothetically what without due to financial stability. -- They have to be you know the extreme. Instability. That you can think. We you know -- she negative consequences. All -- Europe so. It's really. Like Yahoo! unthinkable that. Have had. Thank you very much.

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ECB’s Constancio says break-up of euro zone “unthinkable"

Monday, December 19, 2011 - 05:05