EUOBSERVER / BRUSSELS - Despite Benelux governments announcing a partial nationalisation of Fortis Bank on Sunday, the ongoing financial crisis continued to collect scalps through Europe on Monday (29 September), with the UK and Germany intervening to save financial institutions. Meanwhile, the European Central Bank has announced it would lend eurozone banks €120 billion in "a special term refinancing operation." The European Central Bank announced it would lend eurozone banks €120 billion in "a special term refinancing operation." The decision by the Belgian, Dutch and Luxembourger governments to purchase half the Belgo-Dutch banking giant for €11.2 billion represents the biggest bailout of a European bank since the beginning of the crisis. The European Commission said on Monday it had been consulted during the negotiations and had so far no reason to believe the deal was in breach of EU competition rules. "Up until now the national authorities in Belgium, the Netherlands and Luxembourg have been listening to what the commission has been saying, so we have no reason to think that what they are going to notify the commission of is not going to be acceptable to the commission in terms of state aid rules," Jonathan Todd, a spokesperson for the institution told a press briefing in Brussels.
EUOBSERVER / BRUSSELS - Despite Benelux governments announcing a partial nationalisation of Fortis Bank on Sunday, the ongoing financial crisis continued to collect scalps through Europe on Monday (29 September), with the UK and Germany intervening to save financial institutions. Meanwhile, the European Central Bank has announced it would lend eurozone banks €120 billion in "a special term refinancing operation."
The European Central Bank announced it would lend eurozone banks €120 billion in "a special term refinancing operation."
The decision by the Belgian, Dutch and Luxembourger governments to purchase half the Belgo-Dutch banking giant for €11.2 billion represents the biggest bailout of a European bank since the beginning of the crisis.
The European Commission said on Monday it had been consulted during the negotiations and had so far no reason to believe the deal was in breach of EU competition rules.
"Up until now the national authorities in Belgium, the Netherlands and Luxembourg have been listening to what the commission has been saying, so we have no reason to think that what they are going to notify the commission of is not going to be acceptable to the commission in terms of state aid rules," Jonathan Todd, a spokesperson for the institution told a press briefing in Brussels.
At this point (with h/t to ChrisCook) they are the lynch pin of an economy. Pull it and watch the whole edifice collapse.
"Finance is so central and peculiar, so essential, and yet it carries a death threat for the economy," said Jagdish Bhagwati, a professor of economics at Columbia. "What we've seen, once again, is that finance is a very powerful instrument, but one that needs to be intensively watched."
