BRUSSELS (Reuters) - Latest plans to wind up failing euro zone banks may be overly complicated and inadequately funded, European Central Bank President Mario Draghi said on Monday.
Under the terms of an EU proposal seen by Reuters on Saturday, the cost of closing down a bank in the currency bloc will initially be borne almost fully by its home country, but the obligations of euro zone partners will gradually rise to be shared equitably after 10 years.
The proposal will be discussed at an extraordinary meeting of senior EU officials in Brussels on Monday.
“I am concerned that decision-making may become overly complex and financing arrangements may not be adequate,” Draghi said, speaking at the European Parliament.
“I urge you and the Council to swiftly set-up a robust Single Resolution Mechanism, for which three elements are essential in practice: a single system, a single authority, and a single fund. We should not create a Single Resolution Mechanism that is single in name only,” Draghi said.
Reporting by Martin Santa, writing by Eva Taylor; editing by Patrick Graham