ECB’s Coeure Says Banks Need Bailout Fund Direct Access

The euro zone needs a single bank resolution mechanism and fund as well as a unified deposit insurance plan, European Central Bank Executive Board member Benoit Coeure said.

Banks that must be recapitalized should be allowed to directly access the European Financial Stability Facility and, once it’s in place, the European Stability Mechanism, Coeure said at the Festival dell’Economia in Trento, Italy.

“Letting euro area banks access the EFSF/ESM should not be a way for governments to escape their responsibilities and to rid themselves of the cost of past errors,” Coeure said. “It should be accompanied by strong, centralized supervision of systemically important institutions.”

The ECB said the speech, published today, was delivered on June 1.

To contact the reporter on this story: Jeff Kearns in Washington at jkearns3@bloomberg.net

To contact the editor responsible for this story: Chris Wellisz at cwellisz@bloomberg.net