Reuters writes "MEPs seek to water down EU bank deposit guarantee plan - draft report." It tells us, "European lawmakers plan to water down a European Commission plan to guarantee bank deposits, according to a draft report seen by Reuters, throwing up another hurdle to regulators' plan to boost savers' confidence and the financial sector. The proposed European Deposit Insurance/​Reinsurance Scheme (​EDIS) is seen as the third element of a European banking union aimed at reinforcing the banking sector in the wake of the 2008 global crisis. The plan envisions deposits up to 100,​000 euros ($​110,​600) in any euro zone bank being guaranteed with funds from national schemes, but it has drawn criticism from some quarters, with Germany viewing it as an unfair pooling of risk." The article adds, "While the EU executive'​s intention is for EDIS to evolve into a fully mutualised co-​insurance scheme over a number of years, the document said that lawmakers believed this could happen only if and when certain conditions are met. The committee also doubted whether a common fiscal backstop would break the so-​called "​doom loop" between over-​indebted sovereigns and over-​extended banks. Lawmakers also want 50 percent of the money to remain in the national deposit guarantee systems, 25 percent in a risk-​based sub-​fund and only 25 percent in a joint-​risk fund."

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