<p>German Chancellor Angela Merkel and British Prime Minister Gordon Brown are among the leaders who have expressed their intention to work together in reforming the international financial markets to prevent a recurrence of the global financial crisis of 2008.<br /><br />After her talks with Brown on Thursday in London, Merkel said she was very pleased that the British government planned to join Germany and France in introducing a levy on their banks.<br /><br />Germany, Britain and France are working together to hammer out a joint initiative by the European Union on financial markets reform before the June meeting of the heads of state and government of the G-20 nations in Canada.<br /><br />This will enable the Europeans to put pressure on the US at the summit to get engaged in a global financial market reform "to make sure that if banks get into trouble in the future, they will not become a burden on the taxpayers and they can carry the risks themselves," Merkel said.<br /><br />The bank levy plans are "constructively discussed" both in Britain and in the United States and "there is a high degree of conformity," the Chancellor said.<br />The German and the French governments on Wednesday jointly endorsed a plan to impose a levy on their countries' banks at a Cabinet meeting in Berlin, which was attended for the first time by French Finance Minister Christine Lagarde.<br />The two governments approved a Franco-German position paper on regulating the financial markets. It calls for joint efforts in restructuring sick financial institutions.<br />They also agreed that the proposed bank levy should be oriented to the systemic risks of a financial institution.<br /><br />Moreover, the financial institutions should be guaranteed the same conditions for competition on the European nations and on the level of the G-20 States.<br />Under the bank levy plan, the financial institutions will pay the proposed levy into a stability fund, which could be used to bailout banks in danger of a bankruptcy. The level of the tax will be oriented to the size of the financial institutions and the volume of risky business they undertake.<br /><br />The plan will also make it easier to restructure financial institutions which are in danger of insolvency.The bank levy plans bring together "a bundle of measures we have drawn up at the G-20, European and national levels to take lessons from the financial crisis and to prevent a crisis of similar dimension from happening again," said German Finance Minister Wolfgang Schaeuble. The German Finance and Justice Ministries are presently working on a legislation to impose a bank levy, which will be brought before Parliament for approval in June, Schaeuble said after the Cabinet meeting.<br /><br />Germany is hoping that the proposed levy will raise up to 1.2 billion Euros annually and the stability fund would protect taxpayers from the costs of bank bailouts in future.<br />Schaeuble said the government decided for a "moderate levy" not to endanger the ongoing process of restructuring the financial institutions.<br /><br />The proposed levy will be imposed in such a way that it will not cause a burden on the financial institutions. The government will also make sure that the business and industry continue to receive sufficient credits from the banks.Madame Lagarde said her participation in the German Cabinet demonstrated the depth of the Franco-German relations.<br /><br />The French government will soon take steps to introduce a similar bank levy and other financial market reforms. Germany and France have a common position on bank levy and other financial market reform plans, she said.Chancellor Merkel had earlier rejected calls for Germany to introduce a bank levy similar to the "financial crisis responsibility fee" announced by US President Barack Obama in January, saying there was no need for her country to follow the US lead.<br /><br />She held the view that the US had to engage "more extensively" than Germany in the course of the financial crisis to rescue its financial institutions.Merkel has also been demanding coordinated international initiatives to reform the financial markets rather than unilateral steps.<br /><br />Germany's opposition parties claim that the government's decision to impose a bank levy now is politically motivated ahead of a crucial election in the state of North Rhine Westphalia in May.The ruling parties have been losing grounds in the run-up to the election.<br /><br />Critics of the bank levy plan say that the estimated annual revenue of 1.2 billion Euros from the bank levy is modest considering the estimated 160 billion Euros the government had spent to bail out financial institutions in the wake of the financial crisis.<br />In contrast, President Obama's "financial crisis responsibility fee," which proposes to levy 0.15 percentage points on the balance sheets of the country's 50 biggest banks, is estimated to raise more than USD 90 billion over the next ten years. <br /></p>
<p>German Chancellor Angela Merkel and British Prime Minister Gordon Brown are among the leaders who have expressed their intention to work together in reforming the international financial markets to prevent a recurrence of the global financial crisis of 2008.<br /><br />After her talks with Brown on Thursday in London, Merkel said she was very pleased that the British government planned to join Germany and France in introducing a levy on their banks.<br /><br />Germany, Britain and France are working together to hammer out a joint initiative by the European Union on financial markets reform before the June meeting of the heads of state and government of the G-20 nations in Canada.<br /><br />This will enable the Europeans to put pressure on the US at the summit to get engaged in a global financial market reform "to make sure that if banks get into trouble in the future, they will not become a burden on the taxpayers and they can carry the risks themselves," Merkel said.<br /><br />The bank levy plans are "constructively discussed" both in Britain and in the United States and "there is a high degree of conformity," the Chancellor said.<br />The German and the French governments on Wednesday jointly endorsed a plan to impose a levy on their countries' banks at a Cabinet meeting in Berlin, which was attended for the first time by French Finance Minister Christine Lagarde.<br />The two governments approved a Franco-German position paper on regulating the financial markets. It calls for joint efforts in restructuring sick financial institutions.<br />They also agreed that the proposed bank levy should be oriented to the systemic risks of a financial institution.<br /><br />Moreover, the financial institutions should be guaranteed the same conditions for competition on the European nations and on the level of the G-20 States.<br />Under the bank levy plan, the financial institutions will pay the proposed levy into a stability fund, which could be used to bailout banks in danger of a bankruptcy. The level of the tax will be oriented to the size of the financial institutions and the volume of risky business they undertake.<br /><br />The plan will also make it easier to restructure financial institutions which are in danger of insolvency.The bank levy plans bring together "a bundle of measures we have drawn up at the G-20, European and national levels to take lessons from the financial crisis and to prevent a crisis of similar dimension from happening again," said German Finance Minister Wolfgang Schaeuble. The German Finance and Justice Ministries are presently working on a legislation to impose a bank levy, which will be brought before Parliament for approval in June, Schaeuble said after the Cabinet meeting.<br /><br />Germany is hoping that the proposed levy will raise up to 1.2 billion Euros annually and the stability fund would protect taxpayers from the costs of bank bailouts in future.<br />Schaeuble said the government decided for a "moderate levy" not to endanger the ongoing process of restructuring the financial institutions.<br /><br />The proposed levy will be imposed in such a way that it will not cause a burden on the financial institutions. The government will also make sure that the business and industry continue to receive sufficient credits from the banks.Madame Lagarde said her participation in the German Cabinet demonstrated the depth of the Franco-German relations.<br /><br />The French government will soon take steps to introduce a similar bank levy and other financial market reforms. Germany and France have a common position on bank levy and other financial market reform plans, she said.Chancellor Merkel had earlier rejected calls for Germany to introduce a bank levy similar to the "financial crisis responsibility fee" announced by US President Barack Obama in January, saying there was no need for her country to follow the US lead.<br /><br />She held the view that the US had to engage "more extensively" than Germany in the course of the financial crisis to rescue its financial institutions.Merkel has also been demanding coordinated international initiatives to reform the financial markets rather than unilateral steps.<br /><br />Germany's opposition parties claim that the government's decision to impose a bank levy now is politically motivated ahead of a crucial election in the state of North Rhine Westphalia in May.The ruling parties have been losing grounds in the run-up to the election.<br /><br />Critics of the bank levy plan say that the estimated annual revenue of 1.2 billion Euros from the bank levy is modest considering the estimated 160 billion Euros the government had spent to bail out financial institutions in the wake of the financial crisis.<br />In contrast, President Obama's "financial crisis responsibility fee," which proposes to levy 0.15 percentage points on the balance sheets of the country's 50 biggest banks, is estimated to raise more than USD 90 billion over the next ten years. <br /></p>