• Sweden edition
 
Euro crisis a threat to Swedish banks: Borg

Euro crisis a threat to Swedish banks: Borg

Published: 12 Oct 2011 13:40 GMT+02:00
Updated: 12 Oct 2011 13:40 GMT+02:00

Sweden may have some of the strongest public finances in Europe but its banks are more vulnerable than most in the current euro debt crisis, Finance Minister Anders Borg said in an interview published Wednesday.

"Sweden does not have access to the liquidity that the ECB (European Central Bank) provides the euro countries," Borg told financial daily Dagens Industri (DI).

The Scandinavian country, a member of the European Union but not of the eurozone, "is dependent on our own central bank and our own krona and we are therefore more vulnerable than many other countries," the finance minister said.

He stressed that the liquidity crisis hitting European banks was at the core of the turmoil seen in recent months and pointed out that "Swedish banks' financing in foreign currencies has risen over the past four to five years.

"That represents a serious stability risk for the Swedish economy," he said.

Borg said earlier this week the country needed a way to dampen borrowing in foreign currencies and to create better tools to ensure liquidity.

"We're thinking of imposing some kind of liquidity fee (on the banks) that in turn could be used to strengthen the currency reserves," he told DI Wednesday.

The fee, which Borg proposed on Monday, would allow the Swedish state to make up for the use of its currency reserves in times of crisis to help struggling domestic banks.

Several Swedish banks criticised the proposed fee.

"At a time when things are so shaky in Europe we do not need more initiatives that create market uncertainty," Kerstin af Jochnick, who heads the Swedish Bankers' Association that represents the country's banks, told DI.

Borg meanwhile stressed the need for the European Union to find "constructive solutions to end the market turbulence and allow the recovery to resume.

"The stability of the banks is a European question and is not just a matter of the eurozone bank system," he said, pointing out to Swedish public radio that the heavily export-dependent Scandinavian country was severely threatened by Europe's ballooning debt crisis.

"Basically all of our exports are dependent on credit-lines. If there is no working European credit market the situation will be very tough," he warned.

AFP/The Local (news@thelocal.se)

Don't miss...X
Left Right

Your comments about this article

16:16 October 12, 2011 by rouzi
It is good that they finally reach the conclusion that they are not separate from the rest of the world and decided to accept the truth. Now , may they can do something useful.
17:32 October 12, 2011 by HYBRED
If Sweden is so dependent on exports they should see what they can do to lower the value of the SEK to be more competetive with the Euro, and the US Dollar for that matter.
00:14 October 13, 2011 by rumcajs
good. finaly someone wanna make the BANKS pay their "insurance" and not wait for them go to hell and then ask PEOPLE to pay their casino problems.
Today's headlines
Sponsored Article
On the move: Sweden's shifting mobility trends
House keys: Shutterstock.

On the move: Sweden's shifting mobility trends

Finding somewhere to live when you move to Sweden is a challenge. With changes afoot The Local caught up with an expert from letting agency Residensportalen to find out in what direction the market is going, and how Google Glasses may just help you find your dream home. READ () »

The Local List
Ten most disgusting Swedish foods
Salty liquorice, anyone? Photo: Anders Wiklund/TT

Ten most disgusting Swedish foods

Swedish food is, of course, a matter of taste. But it's mostly disgusting. Our loyal followers on Twitter and Facebook shared what they thought were the worst of them all. READ () »

Sweden wants cruise missiles 'for defence'
Defence Minister Karin Enström. File photo: TT

Sweden wants cruise missiles 'for defence'

The Swedish government has announced plans to beef up its defence forces by fitting its fleet of Gripen fighter jets with long-range cruise missiles. READ () »

Swede of the Week
Sweden's oldest would-be MP: 'They promised I wouldn't get in'
Swedes vote in the 2010 elections. File photo: Dan Hansson/TT

Sweden's oldest would-be MP: 'They promised I wouldn't get in'

Gösta Arvedson, 89, is the oldest Riksdag candidate in Sweden, but our Swede of the Week explains that the Liberal Party (Folkpartiet) had to make some unusual promises for him to put his name forward. READ () »

Elections 2014
Most Swedes lack info ahead of EU vote
The Green Party is one of only two parties devoting their websites to the EU elections. Here campaign manager Emma Rung presents the party's posters. Photo: Leif R Jansson/TT

Most Swedes lack info ahead of EU vote

The majority of Swedes feel the country's political parties are not doing enough to inform them about the upcoming European Parliament elections. Only two of the eight parties have dedicated their homepages to the May 25th polls. READ () »

Fatal Norrköping Brawl
Local church tried to stop Norrköping murders
Swedish police on the scene following Monday's fatal brawl. File: TT

Local church tried to stop Norrköping murders

The Syrian-Orthodox Church in Ektorp had tried to quell tensions between two rival families just hours before bad blood spilled into a massive brawl and two brothers lost their lives. READ () »

JobTalk Sweden
'Foreigners don't need to show banks Swedish ID'
The bridge that connects Sweden to the European continent. File: L.E. Daniel Larsson/Flickr

'Foreigners don't need to show banks Swedish ID'

The Swedish agency that helps Europeans fight impediments to the EU principle of free movement has revealed an increase in complaints, including one from a foreign citizen unable to open a bank account in Sweden. READ () »

Eurovision 2014
Pig heart shatters in Sweden's Eurovision clip
Sanna Nielsen in the new clip. Photo: YouTube (screenshot)

Pig heart shatters in Sweden's Eurovision clip

Sweden's Eurovision hopeful Sanna Nielsen released the official video for the song Undo on Wednesday, a clip featuring leather, slow motion destruction, and a frozen pig's heart and some violence. READ () »

Software robot pinches Swedish flats in seconds
Swedish apartments. File: The Local

Software robot pinches Swedish flats in seconds

A Swedish landlord suspects that a property fixer has set up a software robot to sign up for new flats on the market within seconds, and is charging house hunters to use the service. READ () »

Swedish zoo fire 'kills only the spiders'
Photo: Johan Nilsson/TT

Swedish zoo fire 'kills only the spiders'

Twenty-five fire fighters were on hand on Wednesday night when a fire broke out in a southern Sweden animal park. The vast majority of the animals were unharmed, but the cluster of spiders wasn't so lucky. READ () »

RECEIVE OUR NEWSLETTER AND ALERTS
Shutterstock
Sponsored Article
On the move: Sweden's shifting mobility trends
finest.se
Gallery
People-watching April 23
TT
Gallery
Inside the 850-year-old king's coffin
Features
Sponsored: South-eastern Sweden offers Öland beaches and more
Gallery
Swedish underwear shop puts staff in front of the camera
Gallery
IN PICTURES: The Local's Property of the Week - Täby
Sponsored: India+Sweden Week - India Unlimited
Features
Sponsored: India+Sweden Week - A film, food, and finance feast
National
University applications rocket to record high
finest.se
Gallery
People-watching April 18-20
TT
Society
Kids in Victorian garb mark Swedish Easter
Shutterstock
National
Swedish MP ordered chemtrail probe
Society
Swedish supermarket Ica pulls contested Easter commercial off air
Advertisement:
Kungahuset
Society
Swedish royals set baptism date for princess
finest.se
Gallery
People-watching April 16
Politics
Who's the prime minister's heir?
Alfie Atkins
Society
Are children's books the key to families integrating in Sweden?
National
'Sweden Dem protests cater to party's martyr image'
National
'Swedish research grants were fantastic, but now it's like Australia'
Society
Only in Sweden: The ten problems you'd never encounter elsewhere
National
Swedes stopped to take my picture, but didn't look me in the eyes
Business & Money
A swipe of the hand replaced cash and cards in Lund
YouTube
Features
Video: Oliver Gee finds out how to embrace The Swedish Hug
TT
National
Abba duo hints at reunion
Private
National
Flash mobs hug it out across Sweden
Stockholm School of Economics
Sponsored Article
Why a bachelor's degree is no longer enough
Latest news from The Local in Switzerland

More news from Switzerland at thelocal.ch

Latest news from The Local in Germany

More news from Germany at thelocal.de

Latest news from The Local in Spain

More news from Spain at thelocal.es

Latest news from The Local in France

More news from France at thelocal.fr

Latest news from The Local in Italy

More news from Italy at thelocal.it

Latest news from The Local in Norway

More news from Norway at thelocal.no

Blog Update: The Diplomatic Dispatch

28 October 15:16

The Green Growth Group Summit »

"Today on the 28 October in Brussels, a large group of key EU Ministers and business people, including UK Secretary of State for Energy and Climate Change Edward Davey, and Swedish Environment Minister Lena Ek, will meet to discuss green growth. They all have a stake in resolving a challenge which, although it is crucial..." READ »

720
jobs available
Swedish Down Town Consulting & Productions
Swedish Down Town Consulting & Productions is an innovative business company which provides valuable assistance with the Swedish Authorities, Swedish language practice and general communications. Call 073-100 47 81 or visit:
www.swedishdowntown.com