Net Net: Promoting innovation and managing change
Net Net: Promoting innovation and managing change

EIB Denies It Is Part of European Bailout Plan

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The European Investment Bank (EIB) is now denying that it is involved in a potential plan to prevent a sovereign debt financial meltdown.

On Monday, CNBC reported that a detailed plan was in the works to have the European Financial Stability Facility provide seed funding to special purpose vehicle that would issue its own bonds and buy distressed sovereign debt with the proceeds. (The EFSF is a vehicle financed by euro zone members, created in May of last year, that's designed to provide financial assistance to euro zone states suffering economic difficulty.)

Accoring to the proposed plan, the EIB was supposed to run the bailout vehicle, according to an official who spoke to CNBC.

Apparently, no one has consulted the EIB about this.

"There have been media reports about a potential involvement of the EIB in a special purpose vehicle in connection with the EFSF for the purpose of bailouts," the bank said in a statement to Reuters Tuesday. "The EIB has not been approached and has no plans to be involved in this. The EIB will continue to focus on its mission, which is financing viable investment projects."

In other words: The meltdown is back on, people.

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