Prime Minister Katainen: The Euro area needs concrete measures – covered bonds

Prime Minister Jyrki Katainen. Photo: Prime Minister´s office. Prime Minister Jyrki Katainen. Photo: Prime Minister's office.

The Prime Minister of Finland, Mr Jyrki Katainen, calls for swift, concrete and comprehensive measures to address the crisis in the Euro area. All the Member States must contribute to it.

“As one practical step vulnerable Member States could issue covered bonds to access markets with lower interest rates. Covered bonds are backed by government assets or by tax revenue ear-marked to service the bonds. This is what Finland did in a difficult economic situation in the 1990s and it is standard practice for banks today”, Prime Minister Katainen says.

“The EFSF or ESM could stand ready to intervene in the primary market to facilitate successful issuance of the covered bonds. This together with strong policies by the Member States concerned would be important to ensure the stability of the euro area”, says Katainen.