BRUSSELS (Reuters) - Rules governing bank rescues provide for exceptions where financial stability is threatened, Europe's competition commissioner said on Thursday, but added that no situation had yet been judged serious enough to trigger them.
Margrethe Vestager's remarks could indicate there is little appetite in Brussels to avoid imposing losses on private investors in ailing Italian banks, as requested by Rome.
The European Union adopted new regulations for bailing out banks after governments and taxpayers spent billions rescuing lenders in the wake of the 2007-08 financial crisis.
The rules say creditors must take losses before public money can be used, although waiver provisions mean private investors can be spared if bailing them in "would endanger financial stability or lead to disproportionate results".
"The rules say if there is risk (to) financial stability, then there are exceptions for burden sharing and bail-in," Vestager said at a news conference in Brussels.
"The important thing is to figure out what is financial instability. So far during very serious circumstances in Spain, in Greece, in Slovenia the exceptions were never triggered."
Recent bank rescues have seen the Commission ask for a minimum degree of losses for private investors -- mostly hitting subordinated debt holders -- in return for public support.
But Italy is seeking to spare all private investors in a planned public recapitalisation of its weakest banks, including Monte dei Paschi di Siena (MI:BMPS). When Rome hit banks' creditors as part of the rescue of four small lenders in November, mass protests and the suicide of one saver followed.
The government of Matteo Renzi is stressing that the Brexit vote on June 23 has made things worse for Italy's banking sector, which has seen a bigger share price collapse than in any other European country following the British referendum.
That argument did not seem to have convince Vestager, however.
"So far obviously things are troublesome, but the stock market does no tell the full story of financial stability," she said on Thursday, underlining that Brexit had also caused turmoil outside Italy.