Share

Trichet: No to bailout fund lending

Brussels - The European Central Bank (ECB) should not help efforts to boost the financial firepower of the eurozone's rescue fund by lending it money, the outgoing president of the Frankfurt-based body said on Tuesday.

While a top-up of the €440bn ($584bn) European Financial Stability Facility (EFSF) has been ruled out, there are discussions on allowing it to borrow funds using its capital as a guarantee - a practice known as leveraging.

"I am not in favour of bailout funds refinanced by the ECB. There, I think there is some confusion of responsibilities," ECB President Jean-Claude Trichet told the European parliament in a valedictory committee hearing in Brussels.

Trichet, a Frenchman, is stepping down after an eight-year term on October 31, and is due to be succeeded by Italy's central bank governor, Mario Draghi.

The EFSF is already providing funds for the Irish and Portuguese bailouts, and is scheduled to chip in for the second €109bn rescue package for Greece, which was announced in July.

The fund is thought to be too small to be able to rescue Italy or Spain were either of those countries to run into trouble while performing the new functions assigned to it by EU leaders - namely recapitalising banks and buying the bonds of troubled eurozone governments.
We live in a world where facts and fiction get blurred
Who we choose to trust can have a profound impact on our lives. Join thousands of devoted South Africans who look to News24 to bring them news they can trust every day. As we celebrate 25 years, become a News24 subscriber as we strive to keep you informed, inspired and empowered.
Join News24 today
heading
description
username
Show Comments ()
Rand - Dollar
19.02
-0.6%
Rand - Pound
23.97
-0.3%
Rand - Euro
20.53
-0.3%
Rand - Aus dollar
12.35
-0.0%
Rand - Yen
0.13
-0.6%
Platinum
894.10
-0.3%
Palladium
996.00
-0.6%
Gold
2,196.05
+0.1%
Silver
24.45
-0.8%
Brent Crude
86.09
-0.2%
Top 40
67,848
+0.3%
All Share
74,067
+0.2%
Resource 10
56,251
+1.1%
Industrial 25
103,518
+0.2%
Financial 15
16,466
-0.4%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Editorial feedback and complaints

Contact the public editor with feedback for our journalists, complaints, queries or suggestions about articles on News24.

LEARN MORE
Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders