Bloomberg News

Finland Will Approve Europe’s Expanded Rescue Fund, Sasi Says

September 28, 2011

Sept. 28 (Bloomberg) -- Finland’s parliament will approve the expansion of Europe’s temporary rescue fund, according to Kimmo Sasi, head of the parliament’s Finance Committee.

“I’m fully confident” lawmakers will pass the European Financial Stability Facility amendments, Sasi said today in an interview with Bloomberg TV’s Countdown with Owen Thomas. “It will be quite some majority today in the Finnish parliament.”

Today’s parliamentary vote in the northernmost euro member won’t include Finland’s collateral requirement in exchange for its contribution to a second Greek bailout. The condition has threatened to derail Europe’s crisis-fighting efforts and roiled European financial markets.

The Helsinki-based parliament will vote on each bailout paid from the EFSF, and its collateral demands will be addressed by lawmakers on a case by case basis, Finance Minister Jutta Urpilainen said Sept. 20.

“When we discuss the second package for Greece, that is the point when we need collateral,” said Sasi, a lawmaker from Prime Minister Jyrki Katainen’s National Coalition party. “Now it’s only a question of the mechanism. When the mechanism is used for new countries and new measures, at that stage we raise the question of collateral.”

No Collateral Solution

Negotiations over collateral “are still going on, but there is no clear solution at this moment,” Sasi said.

Spain, France, Italy, Belgium, Luxembourg, Greece, Ireland and Slovenia have already approved the enhanced powers for the 440 billion-euro ($597 billion) fund. All euro nations need to approve the plan adopted by European leaders on July 21.

Under its expanded powers, the EFSF would take over bond buying responsibilities from the European Central Bank and be able to lend to nations before they need a bailout.

Finland’s parliament will vote at 2 p.m. local time. The government holds 124 seats in the 200-member assembly. German lawmakers will get their say on the package tomorrow.

--Editor: Tasneem Brogger, Jonas Bergman.

To contact the reporters on this story: Kati Pohjanpalo in Helsinki at kpohjanpalo@bloomberg.net; Owen Thomas in London at othomas17@bloomberg.net

To contact the editor responsible for this story: Tasneem Brogger at tbrogger@bloomberg.net


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