AP News

Draghi: Europe needs more bank safeguards

FRANKFURT, Germany (AP) — The head of the European Central Bank says it's time for European leaders to set up an authority to clean up failed banks "in a way that does not force us to use taxpayer money."

Draghi said Monday that's the next important step after EU leaders agreed last week to put the ECB in charge of overseeing banks as Europe's single supervisor.

As supervisor, the ECB could remove a bank's license and sanction it for breaking rules. The resolution authority could go further and force losses on bank shareholders and creditors first before tapping taxpayers' money.

Leaders said they would take up the issue next year. The new measures are aimed at keeping busted banks from sinking government finances, as they did in Ireland and threatened to do in Spain.

The Aging of Abercrombie & Fitch
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