Swedish Finance Minister Anders Borg on Friday criticized major Swedish banking groups for not signing on to a stability plan approved earlier this week, reported dpa. Speaking to reporters after a meeting of parliament's committee on European Union affairs, Borg said he also urged the general public to "pick up the phone and call their bank to find out if they have lowered their mortgage rates" or not. Borg said he was disappointed that the banks have not lowered mortgage rates as much as envisaged in the wake of the plan that was approved Thursday by the European Commission in Brussels. Banks or financial insitutions seeking capital from the voluntary guarantee fund worth 1,500 billion kronor (201 billion dollars) would have to comply with restrictions concerning bonus payments and other benefits to top executives. The fund was to ensure that capital starts flowing between banks and other institutions, and lower borrowing costs for banks. The government would also take over preferential shares if a bank that had requested funds failed to meet its payments. The finance minister said it was "disgraceful" if large bonuses "for a few people were to prevent lower mortgage rates." Financial Markets Minister Mats Odell has compared the stability plan to an insurance policy for banks. In addition to the voluntary fund, a 15-billion-kronor fund was also to be created. The Swedish National Debt Office was to manage the fund that was to be financed by the state and banking sector.
