Eurozone bank tax proposed to help Greece bail-out

A proposal to tax eurozone banks to help pay for a Greek rescue has emerged as the possible central pillar of a new bail-out programme, according to officials involved in negotiations ahead of an emergency European summit on Thursday.

The plan, which advocates believe could raise €30bn ($42.5bn) over three years, could help satisfy German and Dutch demands that private holders of Greek bonds contribute to a new €115bn bail-out.

It would also likely avoid a default on Greek debt, which is being fiercely resisted by the European Central Bank.

Both Berlin and The Hague are still insisting that other options for private bondholder participation be included, however, and one senior European official said a “sensible” version of other recent proposals is likely to be adopted.

Officials said those proposals – which include a government-financed bond buy-back programme, a German-backed bond swap proposal, and a French plan for bond rollovers – could be included as a “menu” of options available to bondholders, who would make their own evaluation on which to choose.

But Angela Merkel, the Gimferman chancellor, gave a clear signal of how diffuse the negotiations remained, saying at a news conference on Tuesday that “further steps will be necessary” after the summit, which would not be “one spectacular event that solves everything”.

http://www.ft.com/intl/cms/s/0/f8ae8bf4-b220-11e0-9d80-00144feabdc0.html#axzz1SFdvQRbB

 

Should have been done a LONG time ago.