UPDATE 1-Not up to ECB to rescue banks - Nowotny, Lipstok
| Reuters
It is up to national
governments, not the European Central Bank, to rescue any banks
that get into trouble, ECB policymaker Ewald Nowotny said on
Tuesday, adding that the central bank was not discussing
restarting its bond purchases or priming to cut rates.
Fellow central banker Andres Lipstok reinforced the message,
saying European central banks are being pushed into functions
that are alien to them and that the ESM bailout fund would be a
more suitable vehicle for tackling the bloc's debt crisis.
Asked by reporters about problems in the Spanish banking
sector, Nowotny, who is Austria's central bank governor, said
the problems were 'unfortunate'.
"We have to be aware that rescuing banks is the
responsibility of national governments," he said. "The role of
the ECB is in the field of liquidity and not solvency."
Spain, already under pressure from financial markets over
its debt-laden regional governments, is now struggling to
recapitalise Bankia, one of many banks burdened with bad debts
from the bursting of a property bubble four years ago.
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