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Hollande says EU bank deposit guarantees should be sacrosanct

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(Globalpost/GlobalPost)

French President Francois Hollande said Tuesday that the safety of bank deposits, called into question by the Cyprus bailout, should be sacrosanct in the European Union.

Hollande said he believes that "the guarantee of deposits should be an absolute, irrevocable principle".

The first Cyprus bailout plan, rejected last week by Cypriot lawmakers, would have taxed all deposits although savings in all EU states are supposed to be guaranteed up to 100,000 euros ($129,000).

The bailout deal agreed on Monday will only hit depositors above 100,000 euros to restructure and wind down the country's top banks, but comments by the head of the eurozone finance ministers that similar measures could be applied in the future unnerved markets.

EU banking union plans eventually call for restructuring and resolution rules that would hit large depositors if wiping out shareholders and bondholders isn't sufficient.

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http://www.globalpost.com/dispatch/news/afp/130326/hollande-says-eu-bank-deposit-guarantees-should-be-sacrosanct