Financial crisis

Reinfeldt not pleased with EU crisis management

EU finance ministers are meeting today in Brussels again to discuss an infusion of capital to save banks on the brink. Prime Minister Fredrik Reinfeldt is disappointed that Sweden hasn’t been able to push through its proposal for a European emergency bank facility.  

“What is most likely needed is a more clear idea about a European emergency facility á la the Swedish solution implemented during the 1990s,” Reinfeldt told Swedish Radio News.  

During the Swedish banking crisis in the 1990s the state went in and saved the problem banks, but demanded part ownership and influence over the banks in return.

European banks will receive new capital to cover loan losses to Euro zone countries in crisis, among other things, and Reinfeldt is not satisfied with the solution model currently on the table.

According to AFP news agency, EU finance ministers agreed to infuse almost 1,000 billion kroner (152 billion US dollars) in needed capital to the banks. Fredrik Reinfeldt would not confirm that sum because, he said, “… it can affect the markets dramatically and because not everything is done yet.”

The capital infusion to banks is one of the points to be brought up at the summit today. The question is closely tied to a demand that banks, especially in France, agree to write off loans to Greece.