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Governments must break the link between states and their banks and minimize costs to taxpayers - Chopra (IMF) supports position proposed by Social Justice Ireland
Governments must break the link between states and their banks according to Ajai Chopra, Deputy Director, European Department, International Monetary Fund, and leader of the 'troika' currently overseeing Ireland's Bailout Agreement with the IMF, the European Central Bank and the European Commission. In a remarkable presentation at the Dublin Economic Workshop in Kenmare on October 15, 2011, he outlined a position that is remarkably similar to that proposed and advocated by Social Justice Ireland for almost three years.
Chopra went on to state that in the event of losses being incured by banks then these losses should be borne "first, by shareholders and holders of equity-like instruments, and second by uninsured creditors, including senior creditors". Chopra went further and argued that "to minimize costs to taxpayers, the new resolution system should be pre-financed by the industry as much as possible, potentially through the EU deposit insurance scheme " which he proposed in his presentation.
Ajai Chopra's full presentaion can be downloaded below