December 10, 2013 / 1:32 PM / 4 years ago

Italy backs 8 percent minimum bail-in for ailing banks

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The Italian Economy Minister, Fabrizio Saccomanni, arrives at the G7 Finance Ministers meeting in Aylesbury, southern England May 10, 2013.Alastair Grant/Pool

BRUSSELS (Reuters) - Italy's Economy Minister Fabrizio Saccomanni said on Tuesday that public intervention on troubled banks should come after inflicting losses on bondholders through a minimum bail-in of 8 percent of total bank liabilities.

Yet, Saccomanni the introduction of bail-in clauses may spread risks across the euro zone banking sector.

"In case of a systemic crisis, public intervention would be preferable to the risk of contagion generated by an extended use of bail-in (clauses)," Saccomanni said speaking at a meeting of European Union finance ministers in Brussels.

Reporting by Francesco Guarascio, writing by Francesca Landini; editing by Lisa Jucca

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