The Austrian Financial Market Authority FMA welcomes the Austrian federal government’s internationally coordinated “stability package for the financial markets”. Austrian financial institutions do have an excellent level of creditworthiness and liquidity, but the package of measures which has now been adopted additionally ensures that, if necessary, any institution can be protected swiftly and decisively from the possibly serious effects of the international financial crisis spilling over into the country. The package puts up a “risk protection umbrella” and guarantees that our financial institutions will be able to fulfil their important economic functions at all times. It also protects their customers and thus strengthens the level of trust in Austria as a financial centre.
The FMA Executive Directors, Helmut Ettl and Kurt Pribil, commented that, “The government’s stability package for the financial markets provides all the instruments needed to act immediately, efficiently and effectively. It guarantees savers’ deposits, protects the customers of financial institutions and strengthens the trust of all the participants in the market in each other and in Austria as a financial centre generally.”
The “stability package for the financial markets” provides a 100% state guarantee for the bank deposits of retail customers. In addition, it offers the federal government all the instruments which would be required for the state to provide immediate assistance to a financial institution that gets into difficulties. These instruments include the issue of guarantees, the assumption of liability or surety, the strengthening of financial institutions’ own funds, and they even cover temporary participations in or takeovers of banks or other institutions.
The “stability package for the financial markets” also extends the rights of the Austrian Financial Market Authority FMA: in future it can swiftly lay down that banks have to take on additional own funds which are suitable for the current risk situation and which go beyond the statutory minimum requirements.
Furthermore, it can issue regulations temporarily prohibiting the so-called short selling of certain financial instruments (including derivative products) at Wiener Börse.
The “Inter-Bank Market Support Act” supports Austrian banks’ business with each other and thus makes an important contribution towards further strengthening the liquidity of Austrian financial institutions. This ensures the provision of credit to the domestic economy and consumers.
FMA Executive Directors Ettl and Pribil conclude that, “As part of an internationally coordinated plan of action, the government’s package of measures also shows the determination of the European Union to act unitedly and with all necessary means against this financial crisis that originated in the USA.
For further information please contact
Klaus Grubelnik (FMA Media Spokesperson)
+43/(0)1/24959-5106
+43/(0676)/882 49 516