Brussels Argues For Bonds With Government Bonds

Brussels Argues For Bonds With Government Bonds

Brussels argues for Bonds with Government bonds from all Euro Countries. The European Commission believes that private investors should be able to purchase packages with government bonds from all euro countries.


Such a European bond of debt paper from nineteen countries is, according to the European Commission, very safe, because due to the shared debt the probability of default is small. That is why the Committee proposes to make this new investment option possible, published by the EYE News.

An EU institution will not issue the so-called SBBS (Sovereign Bond-Backed Securities). Brussels only removes the existing legal barriers and leaves the issuing of the SBBS to the market parties, such as banks.

SBBS packages also arranged according to the economic weight and population size of the nineteen countries in the eurozone. The banks do not have to keep extra capital buffers for them. The risk lies only with the investors.

Minister Wopke Hoekstra (Finance) said Thursday in Brussels that the Netherlands is so far not so enthusiastic about plans to jointly take on debt.

The proposals that EU Commissioner Valdis Dombrovskis (Euro) presented Thursday morning are, according to him, an attenuated form of previous plans for euro bonds.

” I will first study them in peace, but we are and will remain against euro bonds ”, according to Hoekstra. Germany, too, reacts dismissively.

Hidden defects
According to MEP Esther de Lange (CDA), more work needs to performed on risk reduction among banks and member states.

” The EU still has considerable hidden weaknesses on the balance sheets of banks and member states. That program does nothing about this. With this kind of steps, we cover the problems in some countries with the stability of others. ”

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