ECB says investors must share burden of any bank rescue

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”.

“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.
Source: Reuters (Reporting By Francesco Canepa)