In addition to enhanced efforts to improve the communication channels between debtor countries and their creditors, which would also enhance crisis prevention, the ECB would support a move to strengthen the existing framework for the management of financial crises. Three fundamental principles may be helpful to this aim.
First, the framework should rely more on rules and less on discretion than was the case in the second half of the 1990s. A case-by-case approach, lacking clear “rules of the game” on the respective roles of private and official sectors in times of distress, runs the risk of creating the perception that official resources would provide a “safety net” if need be.