Spain has got new target extension of 2014 for budget reforms.
Work on direct bank recapitalisation to start in September
From the Juncker press conference:
Mr Mersch is to be appointed to the ECB exec. board. Mr Juncker is to be reappointed for two and half years but will only stay for six months. Mr Regling will head the ESM.
A political understanding is agreed on the MoU for Spain. Discussed parameters of EFSF loan. Formal agreement in the second half of July. The first disbursement of €30bn will be made before the end of the month, a contingency in case of urgent need. Conditions include an overhaul of the Spanish banking sector.
Loans will be for up to 15 years, averaging 12.5 years. The deficit deadline is extended to 2014.
The new Greek FinMin was welcomed. Greece will be discussed again when a full troika agreement is available.
A programme for Cyprus will be agreed by September.
The meeting adopted a statement on the results of the recent summit.
Slovenia was discussed, but there is no request for assistance.
The Eurogroup will meet on 20 July and perhaps again in the first week of September.
Preparations for direct bank recaps will begin in September, allowing the ESM quickly to adopt such a measure by 'regular decision' once the banking supervisor is in place.
On Ireland, Mr Rehn says the Commission will undertake technical work on improving the sustainability of Irish programme, in co-operation with the Troika partners and the Irish authorities. Concrete decisions will be discussed in September, with a view to reaching a conclusion at the European Council in October.
The ECB will act as fiscal agent for the EFSF in the secondary bond market. All risks will be on the EFSF's balance sheet.
The ESM can start its work after national ratifications are completed; the technical details concerning it have been agreed.
Last edited by whooley; 10th July 2012 at 01:42 AM.
Spanish banks will be arranged in several groups by September: those requiring no capital; those already under FROB; those needing capital; and those needing capital that can be raised privately.
Individual conditionality will be imposed on Spanish banks, and in line with state aid rules.
Mr Juncker says Spanish expectations of a smooth transfer from the EFSF to the ESM are realistic, and that a sovereign guarantee won't be required.
Good news for Ireland there. A result by October would be ahead of expectations.
A. Beesley asked two questions: on the relationship between a deal for Ireland and the establishment of a bank supervisor; and on the level of debt relief being considered. He was told by Mr Juncker only that the Irish deal would be dealt with 'technically' during the summer months.
The Eurogroup statement:
It is hard to say at this stage, perhaps, whether the reference to changed circumstances is positive or negative. It could mean that the complicated Irish bank rescue cannot be retrospectively treated similiarly to Spain's imminent one. But I am more inclined to think that it is a positive inference: circumstances have changed since Ireland's banks were rescued in a way that is now widely accepted was grossly unfair to Irish taxpayers, and that the situation requires a remedy or some sort.The Commission, in liaison with the ECB, and the IMF are currently conducting its seventh
review of the Irish adjustment programme, in the context of which discussions will be held on
technical solutions to improve the sustainability of the well-performing adjustment programme.
The Eurogroup will consider the issue again at its meeting in September. Similar cases will be
treated equally, taking into account changed circumstances.
Last edited by whooley; 10th July 2012 at 02:01 AM.