September 5, 2017 / 9:40 AM / a year ago

ECB says investors must share burden of any bank rescue

FRANKFURT (Reuters) - Private investors must share the burden of any bank rescue, a senior European Central Bank supervisor said on Tuesday, calling for subjecting the sector to “market discipline”.

European Central Bank (ECB) headquarters building is seen in Frankfurt, Germany July 20, 2017. REUTERS/Ralph Orlowski

“A substantial private sector burden-sharing is a non-negotiable prerequisite prior to public funds being touched,” Pentti Hakkarainen, a member of the supervisory board of the ECB, told a conference.

“In regulating and supervising financial institutions, we should still make space for market forces and market discipline to act,” he added.

Reporting By Francesco Canepa

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