7th Annual European Financial Services Conference: extracts from the speech by Joaquín Almunia

Type: Speech - summary   Reference: I-060327   Duration: 10:03:19  Lieu:
End production: 27/01/2009   First transmission: 27/01/2009
Joaquín Almunia, Member of the EC in charge of Economic and Monetary Affairs, addressed the 7th Annual European Financial Services Conference on 27 January 2009 in Brussels. His speech was about "Financial Markets and Economic Recovery: a Critical Juncture".

Only the original language version is authentic and it prevails in the event of its differing from the translated versions.
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10:00:00 Title 00:00:05
10:00:05 Arrival of Joaquín Almunia, Member of the EC in charge of Economic and Monetary Affairs 00:00:11
10:00:16 General view of the conference 00:00:06
10:00:22 Soundbite by Joaquín Almunia (in ENGLISH) saying that the immediate challenge we face today is to prevent a situation where the deepening downturn combines with problems in financial markets and creates a negative spiral of credit losses and write downs, of negative growth and increasing unemployment; this is the time for further action: without actions based on the use of all the economic policy instruments available we will not restore confidence and the normal functioning of the financial sector will be postponed. 00:00:36
10:00:59 Cutaway 00:00:06
10:01:05 Soundbite by Joaquín Almunia (in ENGLISH) on the intervention measures taken by governments to rescue the banking sector: saying that of course, it is still too early to draw final conclusions on the effectiveness of these measures; but he can already say that on the first two objectives –to avoid a global meltdown and to stimulate inter-bank lending- there has been clear results; the possibility of a full scale collapse of the banking sector has been averted and banks have achieved significant recapitalisation; in the fourth quarter of 2008, the amount of capital raised by EU banks exceeded their asset write downs; there has also been an improvement –albeit modest- in quite a number of indicators of financial market stress. 00:00:45
10:01:50 Cutaway 00:00:06
10:01:57 Soundbite by Joaquín Almunia (in ENGLISH) saying that of course, they knew that there would be a lag between rescue plans being announced and implemented and seeing the effects on lending to the real economy; nevertheless, the availability of credit has clearly diminished since October 2008 and it is evident that corporate credit markets are not functioning properly, or are pricing risk at abnormal levels; the reported constraints on the supply side of credit are considered to go beyond those justified by the cyclical downturn in the economy; and failure to normalize credit flows will have serious implications for the real economy. 00:00:45
10:02:42 Cutaway 00:00:06
10:02:48 Soundbite by Joaquín Almunia (in ENGLISH) saying that he wants to stress at this point that any further aid to the banking sector must be based on the principle of transparency; if governments are to continue putting taxpayers' money into financial institutions, they must know from the outset the situation of that institution: its exposure to various risks, the quality of its asset portfolio and the sustainability of its business model in the medium to long term. 00:00:30
10:03:19 Cutaways (2 shots) 00:00:18
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