PRESS RELEASE
Glass-Steagall Debates Upcoming in Europe
Feb. 25, 2015 (EIRNS)—In Switzerland, the government has published its response to the motion calling for banking separation, passed by a SP-SPP majority two years ago in the Parliamentand, as expected, the answer, published in a brief statement Feb. 18, is that “a change in the regulation model is... not necessary.” The government based its decision on a report drafted by an “Experts Group” composed of bankers and so-called “regulators” such as Finma head Mark Branson, one of the authors of the Swiss bail-in regulation. Both the SPP and SP have criticized the government response, with SPP General Secretary Martin Baltisser saying, “Political pressure must continue.”
In Greece, Greek Deputy Prime Minister Yannis Dragasakis has been reorganizing the largest systemic banks, in which the government holds the majority shares. He has notably orchestrated changes in the chairmen and CEOs of the four major banks, in line with the government’s promise to run the banks for the benefit of the country.
The new chairperson of the National Bank of Greece, the country’s largest private “systemic” bank, is expected to be former Economics Minister Louka Katseli, who is no friend of the ECB. In a 2014 paper she delivered a scathing attack on the repeal of the Glass-Steagall Act in the United States in 1999, and the Financial Service Action Plan passed in the same year by the European Commission.
In Strasbourg, the “bank resolution” bill drafted by the EU Commission will come up for a vote in the Economic and Monetary Affairs Committee on March 23-24. The text is an atrocity in favour of bailing-in and bailing-out so-called systemic banks. Two Italian MEPs, Marco Zanni and Marco Valli, have filed a list of 101 amendments to that bill, which if approved, would turn the EU regulation into a serious Glass-Steagall-like banking reform.
Many amendments just suppress articles of the bill that are useless in a banking separation regime, whereas others offer fundamental changes. Amendment 1, for instance, stipulates that there must be no “implicit government guarantee” for trading activities performed by credit institutions.
Other amendments call for resolving crises without implementing a bail-out, and banning all trading activities for commercial banks.
