Jeroen Dijsselbloem, President of the Board of Directors of the European Stability Mechanism, is quoted as say on March 26, 2013: "If there is a risk in a bank, our first question should be: “Ok, what are you the bank going to do about that? What can you do to recapitalise yourself?” If the bank can’t do it, then we’ll talk to the shareholders and the bondholders. We’ll ask them to contribute in recapitalising the bank. And if necessary the uninsured deposit holders: “What can you do in order to save your own banks?”
What Mr. Dysselbloem was saying that if an important bank (remember 2008?) has a problem, they would be given an option to take a percentage of "unsecured" a/o "uninsured" money from their account holders. After all, the money we have in our wallet does not actually belong to us, we just borrow it to use as financial instruments.
Mr. Flaherty, former Minister of Finance presented the Bail-In provisions in his budget in 2013. The G20 approved the Financial Stability Board’s “Adequacy of Loss-Absorbing Capacity of Global Systemically Important Banks in Resolution” in Brisbane late November 2014. Canada is "good to go" where bank bail-ins are concerned.
The EU regulators adopted the banking bail-in measures and compliance was to be achieved by Dec. 31, 2014. However 11 countries failed to implement the Bank Recovery and Resolution Directive (BRRD) by the deadline.
The EU commission has recently given direction that if the 11 countries do not comply within 2 months, the commission may take the countries to the EU Court of Justice.
Where does that leave us? Why is Canada mobilizing to protect banks with the ability to take money from their account holders? Should account holders contribute to the bank if the system experiences difficulties?
The European Commission Press Release can be found @