ECB’s Honohan Says Injecting Equity in Banks ‘Promising Idea’

European Central Bank Governing Council member Patrick Honohan said a proposal to allow Europe’s rescue fund to inject equity into distressed banks is a “promising idea,” which “lowers the risk for the borrowing country.”

He also said the idea of leveraging the rescue fund should not be “seen as free lunch.” Honohan was speaking at a panel discussion in Washington.

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