Lithuania says euro area needs confidence in Greece, bank union

The euro area needs to keep building post-crisis confidence by pursuing joint deposit insurance and keeping Greece’s bailout on track, Lithuanian Finance Minister Rimantas Sadzius said.

The EU needs a common deposit guarantee system “as soon as possible,” Sadzius said in an interview on Thursday in Vilnius. He said the European Commission’s proposals are a positive step, even if talks will be tough.

“Joint European deposit insurance is a path that we will inevitably take,” Sadzius said. “It’s only difficult to predict at this point how quickly this would happen because there’s a variety of discussions.”

Building banking union and keeping Greece’s third rescue on track have been central elements of the 19-nation euro area’s efforts to rebuild and strengthen after the crisis that pushed five of its nations to seek bailouts. Sadzius said talks on restructuring Greece’s debt will begin once it’s clear the current program is on track.

“These discussions will begin at an appropriate time,” he said. “The start will depend on how quickly work proceeds with ongoing measures, and on how the aid program is being implemented. The Greek government is gaining confidence within the euro member states, which was fully erased earlier.”

[Bloomberg]