C Bank Governor: No Bank Recapitalisations at Lest Until 2016 Politics, 24 Jun 2014 / By STA Central bank governor Boštjan Jazbec underlined on Monday that Slovenia had to continue the reform process. Although no new bank recapitalisations will be necessary at least until the end of 2015, the potential failure to continue implementing much needed deleveraging measures will lead to additional recapitalisations, said Jazbec. If Slovenia will not have a fully functional government for a long time or if something goes wrong in Slovenias export markets new recapitalisations will be needed. However it does not seem for now that that will be the case. Jazbec talked to the press after the first meeting of the Financial Stability Committee, a body set up under the recently passed law on macro-prudential oversight of the financial system. The governor of Banka Slovenije, who is also the committee chair, pointed out that the positive trend seen in Slovenia came faster than anticipated. Projections suggested a turn for the better would come at the end of 2014, when in fact a positive trend started already in the first quarter of the year, he said, adding that he expects companies will continue deleveraging. He expressed hope that the people who will be putting together Slovenias next government after the 13 July election will be aware of the need to continue the efforts to deleverage companies. Jazbec believes the new government will have to work fast while keeping in mind recommendations from the European Union and the process of deleveraging. He added that the problems Slovenia is facing did not just happen overnight so it could not be expected that results will be visible soon. We hope that the measures launched by Banka Slovenije will bear fruit as soon as possible, that is in a few months. The committee headed by Jazbec consists of representatives from the central bank, the Insurance Supervision Agency, the Securities Market Agency and of the Finance Ministry; however the latter does not have voting rights. Experience from the financial crisis show that we must change our mindset and that financial crises are inevitable. Macro prudential oversight therefore establishes a framework for early detection of systemic risk and for the mitigation of its consequences, said Jazebc. The committee will be meeting every three months and will issue recommendations, warnings and instructions if any irregularities are detected.
Posted on: Thu, 26 Jun 2014 13:48:45 +0000
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