Brussels warns European banks on responsibility over East European branches

The European Commission announced on Friday that it carefully surveys the East European finances and demands the banks that invested in the region to give prove of responsibility. The statement comes after an increasing number of demands for financial support from the region, AFP informs.

„We are aware of the situation and we are carefully monitoring the situation”, said the EC spokesperson, Amelia Torres.

Still, the responsibility must be shared among the banks that bought banks in the newest EU member states and the fiscal monitoring authorities of those states, so that any problems that might arise would be carefully approached.

The mother-banks and their hosting state bear the main responsibility in recapitalization and guarantees, as well as for providing cash for their East European branches, the official said.

Austrian chancellor Werner Faymann announced on Tuesday that his country intends to put up a plan for the stabilization of all financial systems in Eastern Europe, in order to limit the effects of the crisis. The call was later backed by the German chancellor, Angela Merkel.