Proposals being discussed by Europe's top banks to create a bailout fund should not exclude the wider financial system from contributing to rescues, the EU's financial services chief said on Monday.
European Union Internal Market Commissioner Michel Barnier said he backed two simple ideas -- taxpayers should not foot the bill for bank bailouts, and banks should pay for bank rescues.
Some of Europe's biggest banks are in talks over a proposal from Italy's UniCredit to create a 20 billion euro ($25.2 billion) private sector fund to help failing lenders.
UniCredit Chief Executive Alessandro Profumo outlined the proposal in the Financial Times.
I think it's quite encouraging the banking system itself, Mr. Profumo has said today, that it's useful to create an ex-ante fund, Barnier told a news conference.
But the plan should not rule out having a more comprehensive mechanism funded by the broader financial system and not just exclusively by big banks, Barnier said.
Barnier is due to propose a draft EU law next year that would require EU governments to set up national resolution funds paid for by a levy on financial institutions.
(Writing by Huw Jones, editing by Dale Hudson)