EU says risky banks should pay more for bailouts

BRUSSELS, BELGIUM: EU regulators say riskier banks must pay a higher fee for the government cash bailouts that help them survive the crisis.

They say each bank should pay a premium for the money it receives, based on the bank's risk profile. Banks in distress
that are near insolvency should pay more for state support and face stricter safeguards.

The price of capital injections needs to be high to limit how long governments support the banking sector, regulators said.

The rules form part of the European Commission's new guidelines for how governments could subsidize banks without breaking EU state aid rules.