Wolfgang Schaeuble says ESM will not recapitalise banks in the short termTuesday 04 December 2012 11.08
German Finance Minister Wolfgang Schaeuble has warned against hopes that the EU's permanent bailout fund, the European Stability Mechanism, could be used to recapitalise banks in the short term.
The stance is important to Ireland, as the Government hopes the €500bn ESM will take stakes in Irish pillar banks such as AIB and Bank of Ireland.
Speaking in the European Parliament, Mr Schaeuble said "it's an exaggerated expectation" that banks could access ESM funding quickly.
Asked later by a Spanish MEP if bank recapitalisation could be speedily arranged, Mr Schaeuble said: "I don't think so."
Last month, Mr Schaeuble reiterated that a new oversight body for Europe must first be fully functional before such re-caps could take place.
He told Reuters in early November: "It is important that liability and control go hand-in-hand. In other words, quality clearly comes before speed."