Bloomberg News

CSU’s Michelbach Rejects Direct Bank Aid by Euro Rescue Fund

July 02, 2012

Euro-area countries should avoid recapitalizing banks from the region’s rescue fund without running the aid through governments, said Hans Michelbach, a lawmaker in German Chancellor Angela Merkel’s coalition.

Michelbach’s comment in an e-mailed statement today challenges a June 29 agreement by euro-area leaders allowing direct aid to banks once a European banking supervisor is set up.

Michelbach, a member of the Bavaria-based Christian Social Union party, said European Union countries that don’t overhaul their finances don’t deserve preferred treatment, referring to Italy and Spain.

“If Italy and Spain had good budget management and governance, these countries wouldn’t have problems with refinancing,” said Michelbach, a member of the German parliament’s finance committee.

To contact the reporter on this story: Tony Czuczka in Berlin at aczuczka@bloomberg.net

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net


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