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Euro zone emergency fund ready soon


Euro zone emergency fund ready soon


EU finance ministers, meeting in Brussels, say that the euro zone’s emergency loan facility for countries that find themselves in trouble should be operational this month.

The ministers are reportedly still divided over what data should be released on stress tests for the region’s banks, but the Cypriot minister Charilaos Stavrakis said: “We remain optimistic that it’s a sign of strength for the European banking system if the stress test results come out, whatever the results, and even if there are a few banks that in theory fail the stress tests, I think it is important to show to investors and to the public that the European banking system at large remains strong.”

The tests cover 91 EU banks, which make up two thirds of the bloc’s banking sector. The results will be announced on 23 July.

They will look at how banks would cope with further adverse conditions, including a deeper fall in the value of government bonds.

The intension is to boost market confidence damaged by the Greek sovereign debt crisis.

It is getting easier for Athens to borrow. On Tuesday it had no trouble selling 1.6 billion euros of bonds.

It was the first debt sale since a massive emergency loan backstop from the European Union and International Monetary Fund agreed in May.

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