Soros: EFSF must take control of Europe's banks

Hedge fund guru George Soros has argued the European Financial Stability Facility (EFSF) must take control of Europe's banking system if it is to solve the sovereign debt crisis without causing another banking collapse.

Writing in the Social Europe Journal, Soros says allowing the EFSF to take responsibility for the banking sector would restore confidence in the eurozone. "The European Financial Stability Facility must serve to rescue the banking system as well as member states. This would allow sovereign debt to be restructured without precipitating a banking crisis. "Despite this added task, the size of the rescue package could remain the same, because any amount used for recapitalising or liquidating banks would reduce the amount needed by governments," he says. Soros believes the bulk of perip...