|Source: European Council (Flickr)|
*Moody's Downgrades Three French Banks (Reuters)
*Moody's downgrades Société Générale's long-term ratings to A1 (Moody's)
*Moody's downgrades Credit Agricole SA's long-term ratings to Aa3, concluding review (Moody's)
*Moody's downgrades BNP Paribas's long-term ratings to Aa3, concluding review (Moody's)
*Eurozone to forge ahead as UK blocks treaty change (France24)
*EU States to Send IMF $267 Billion in New Crisis Fight (Bloomberg)
*CDOs To Buy European Bank Stocks And Other Silly Ideas (DealBreaker)
*Wells Fargo to pay $148M fine for Wachovia misdeeds (CNN Money)
*Shadow banking and the seven collateral miners (FT Alphaville)
*Corzine's Loss May Be Soros's Gain - "Investor George Soros's family fund bought about $2 billion of European bonds formerly owned by MF Global Holdings Ltd." (WSJ)
"Strengthening the stabilisation tools
11. Longer term reforms such as the ones set out above must be combined with immediate action to forcefully address current market tensions.
12. The European Financial Stability Facility (EFSF) leveraging will be rapidly deployed, through the two concrete options agreed upon by the Eurogroup on 29 November. We welcome the readiness of the ECB to act as an agent for the EFSF in its market operations.
13. We agree on an acceleration of the entry into force of the European Stability Mechanism (ESM) treaty. The Treaty will enter into force as soon as Member States representing 90 of the capital commitments have ratified it. Our common objective is for the ESM to enter into force in July 2012.
14. Concerning financial resources, we agree on the following:
• the EFSF will remain active in financing programmes that have started until mid-2013 as provided for in the Framework Agreement; it will continue to ensure the financing of the ongoing programmes as needed;
• we will reassess the adequacy of the overall ceiling of the EFSF/ESM of EUR 500 billion (USD 670 billion) in March 2012;
• during the phasing in of the paid-in capital, we stand ready to accelerate payments of capital in order to maintain a minimum 15% ratio between paid-in capital and the outstanding amount of ESM issuances and to ensure a combined effective lending capacity of EUR 500 billion;
• euro area and other Member States will consider, and confirm within 10 days, the provision of additional resources for the IMF of up to EUR 200 billion (USD 270 billion), in the form of bilateral loans, to ensure that the IMF has adequate resources to deal with the crisis. We are looking forward to parallel contributions from the international community.
15. We agree on the following adjustments to the ESM Treaty to make it more effective:
• Concerning the involvement of the private sector, we will strictly adhere to the well established IMF principles and practices. This will be unambiguously reflected in the preamble of the treaty. We clearly reaffirm that the decisions taken on 21 July and 26/27 October concerning Greek debt are unique and exceptional; standardised and identical Collective Action Clauses will be included, in such a way as to preserve market liquidity, in the terms and conditions of all new euro government bonds.
• In order to ensure that the ESM is in a position to take the necessary decisions in all circumstances, voting rules in the ESM will be changed to include an emergency procedure. The mutual agreement rule will be replaced by a qualified majority of 85 % in case the Commission and the ECB conclude that an urgent decision related to financial assistance is needed when the financial and economic sustainability of the euro area is threatened.1
1 subject to confirmation by Finnish parliament.
16. We welcome the measures taken by Italy; we also welcome the commitment of the new Greek government, supported by all parties, to fully implement its programme, as well as the significant progress achieved by Ireland and Portugal in implementing their programmes.
Some of the measures described above can be decided through secondary legislation. The euro area Heads of State or Government consider that the other measures should be contained in primary legislation. Considering the absence of unanimity among the EU Member States, they decided to adopt them through an international agreement to be signed in March or at an earlier date. The objective remains to incorporate these provisions into the treaties of the Union as soon as possible. The Heads of State or Government of Bulgaria, Czech Republic, Denmark, Hungary, Latvia, Lithuania, Poland, Romania and Sweden indicated the possibility to take part in this process after consulting their Parliaments where appropriate."
Read the full statement here: http://consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/ec/126658.pdf