Ministers in Europe are due to meet again soon to continue talks on how the banking system should be reformed. Having already previously spent over 20 hours discussing potential changes, final agreements were not reached and no conclusion decided in terms of restructuring. The ongoing discussions are likely to cause disruption in several markets as the uncertainty continues. The meeting will take place between European ministers on Wednesday after scheduled talks failed last Saturday.
The biggest issue that arose during the talks at the weekend was the order in which creditors and investors should contribute to the restructuring of the banks. There was a particular disagreement in regards to whether savers with over £85,000 in any bank account should be included. Ministers from Britain were especially keen to ensure more flexibility on how depositors would be affected by the changes. Michael Noonan, the Irish finance minister, warned that this second meeting could still prove futile in coming to a decisive end to the debate. He said, “There is no guarantee it will reach conclusion, it is principally an issue on the euro and non euro nations. Pierre Moscovici, the French finance minister had a more optimistic outlook on the planned meeting and was confident that a deal would be brokered.
The aim of having a deal established last weekend would have proved to be an incredibly essential step in putting the banking system in Europe back together. Rescue efforts and supervision of banks within the EU as opposed to member states would have been one such policy change. Regardless of the skepticism being expressed by many important figures who will attend the second meeting, it is evident that if a deal does manage to be put together then it will be a hugely positive step forward for European banking. The global chief economist of Unicredit Research, Erik Nielson, released a statement following the first meetings saying, “All said and done, progress is being made… I am pretty confident that the Ecofin will find a way to agree when they meet again on Wednesday ahead of the summit”.