The Austrian National Bank, commercial banks, and the Raiffeisen Association have issued a joint warning about a potential weakening of the deposit insurance system. This concern stems from a decision made in the EU Parliament, led by rapporteur Othmar Karas (ÖVP), which allows for national deposit insurance funds to be used for resolution cases at a European level. Specifically, half of the funds from national deposit protection funds in Austria, totaling two billion euros, could be transferred to an EU pot, accessible by a European resolution authority if necessary.
While the National Bank acknowledges the importance of being prepared for times of crisis, they also emphasize the need for a coherent overall concept that significantly improves financial market stability before any decisions are made. Johannes Rehulka, Secretary General of the Raiffeisen Association, shares similar concerns and warns against conducting such broad experiments just before the EU elections. Maintaining financial market stability and preserving savers’ trust in functioning systems are paramount and should not be jeopardized without a clear necessity.
The current proposal raises concerns about the protection of depositors as allowing European resolution authorities access to these funds could undermine the goal of safeguarding depositors’ savings according to Willi Cernko, bank chairman in the Austrian Economic Chamber (WKÖ). Cernko emphasizes that depositors’ protection is crucial and should not be compromised in any way. He believes that any changes made to the deposit insurance system must be carefully considered before they are implemented.
In a move to expand its market reach within smart buildings, ABB has announced the…
In New York, the 148th Westminster Kennel Club dog show concluded on Tuesday night with…
LSU left-hander Gage Jump pitched 6.0 innings, allowing just one run on five hits with…
Looking to spark a love for marine biology and science in your children? Then the…
The global economy is facing a number of challenges, with China at the forefront. The…
Gaza has been under siege for over a decade, with over 1.4 million Palestinians living…