ECB May Allow Banks Direct Access to ESM Rescue Fund, SZ Reports

The European Central Bank and countries that use the euro are working on an initiative to allow cash-strapped banks direct acccess to funding from the European Stability Mechanism, Sueddeutsche Zeitung reported in a preview of that will appear today.

The working group will examine how banks can directly access the funding within the next two weeks, the newspaper said. The move comes amid growing concern that Spanish banks are increasingly unable to lend to companies and that the crisis may spread to other euro countries, SZ reported.