Italian Economy Minister Giovanni Tria said that European Union “bail-in” rules covering failing banks should be scrapped.
Tria told parliament he agreed with comments by Antonio Patuelli, the head of Italy’s banking lobby, who earlier in the day said the rules should be abolished because they hurt the confidence of savers, and in any case had never been applied in Italy.
Designed after the global financial crisis to shield taxpayers from costly bank bailouts, bail-in rules required investors in a bank to bear losses before public funds can be tapped.
“Of course I share the opinion of Patuelli,” Tria told a Senate panel.
He added that when the rules were introduced Italy’s economy minister had been “practically blackmailed” by his German counterpart and feared if he had not accepted them it would have sent a message that Italy’s banks were close to collapse.
Tria’s office later issued a statement saying he regretted his “unfortunate” remark regarding blackmail.
