MEPs can claim £120,000 a year in expenses without providing “real proof" of how the money is spent, because EU officials don't want to saddle them with an "administrative burden" which would hamper their freedom, a court heard. EU expenses chief Frank Antoine-Poirel said that only on “very limited occasions” would MEPs be asked for “real proof” of where MEPs allowances ended up. Mr Antoine-Poirel, head of the EU’s Parliamentary Assistance and Members' General Expenditure Unit, admitted he had never seen the bank accounts of long-serving Labour MEP Peter Skinner, who is accused of using his expenses to pay £10,000 to his ex-wife. Skinner, 56, is also alleged to have used some of the cash to repair the gearbox on his ex-wife Julie Skinner's Land Rover Discovery and funded hotel stays, restaurants and jewellery by claiming a maximum £480,000 for support staff over five years. One member of staff, Karen Forbes, was said to have invoiced the former MEP for the South East of England Region, for more than £122,000 in 2005, but worked at Tesco and was actually paid just £525 a month, Southwark Crown Court has heard. Mr Antoine-Poirel, a parliamentary ombudsman tasked with establishing the difference between genuine mistakes and misuse of funds, said: "It would create an administrative burden for members and the consequences on the freedom of actions for the members so we do not want to interfere with their detailed political activities.”

The banks in the Eurozone have done very well in an environment where interest rates are very low, says Benoit Coeure, a member on the board of the European Central Bank (ECB), who adds that their new issues are not caused by the easing of monetary policies.  In his opinion, banks' earnings are low, which diminishes their ability to generate capital, but many of these financial institutions have overcome the impact of the negative interest rates imposed by the Central Bank.  Benoit Coeure also says that the ECB is engaged in ensuring price stability, which sustains bank profitability.  The ECB official said yesterday, in Frankfurt: "Many banks have succeeded in compensating the drop in revenue interest through higher lending volumes, lower interest expenditures, the drop in risk provisions and capital gains".  Coeure's statements seem however seem to minimize the arguments that banks' major problems are caused by non-performing loans, which have nothing to do with the monetary policy. 

"Europe is on the cusp of a largely self-induced humanitarian crisis," UN refugee agency (UNHCR) spokesman Adrian Edwards said on Tuesday. The EU plan for an internal aid mechanism marks a departure for the 28-nation EU, which normally only gives aid to countries outside the bloc, notably in the Middle East and Africa. The EU has an annual aid budget of €1.2 billion for external countries. But the apparent show of European solidarity masks growing criticism of countries that have capped the number of migrants they are willing to let in. European leaders are divided ahead of two summits this month on the migration crisis, with German chancellor Angela Merkel saying that after bailing out debt-hit Greece the country cannot now be allowed to plunge into "chaos". The crisis has also sparked warnings that the EU's Schengen passport-free zone could melt down as more and more states bring back border controls. In a bid to ease the divisions, EU president Donald Tusk is currently touring the Balkan states and Turkey, the main departure point for refugees. Ahead of a crucial EU-Turkey summit on March 7, Mr Tusk said he would press for "a more intensive engagement" from Ankara on a deal signed with the EU in November to limit the flow of refugees.

The crises of mass migration and Greek debt have hit the European Union like an “an out-of-control bulldozer”, forcing its leaders to rethink David Cameron’s call for fundamental reform, the cabinet’s leading Eurosceptic has said.  Iain Duncan Smith, speaking to the Guardian before a Conservative party conference that will see disputes over Cameron’s EU referendum tactics, said the twin crises had changed the debate.  The work and pensions secretary said: “We are getting a better hearing because people are waking up to these things. It is suddenly becoming clear that actually you cannot paper over the cracks and say ‘it’s alright, it’s only the British.’ We still have the crisis over the euro and Greece, and then the rows over Schengen border controls are like nothing I have ever seen. It is massive.”   The two crises had sent “shock waves everywhere”, he said. “Nothing is the same after this thing. The European Union has just been hit by an out-of-control bulldozer that has just gone straight through the middle of them.”

The British pound  saw the biggest decline against the dollar since March 2009, after London mayor Boris Johnson, one of the most popular politicians in the country, said he would start a campaign in favor of the United Kingdom leaving the European Union (Brexit) in the referendum scheduled in June. The pound lost 1.7% at 12:01, on the New York market, to 1.4156 dollars. The pound had earlier lost 1.9% - its biggest decline since March 9th, 2009. All throughout yesterday, the pound fell to 1.4058 dollars - the weakest exchange rate since March 18th, 2009. The British currency weakened against all major currencies yesterday, after having gained significantly at the end of last week. Valentin Marinov, a strategist with "Credit Agricole" SA, states, according to Bloomberg: "The pound is dropping because the agreement achieved by British PM David Cameron in the EU summit (ed. note: - Friday) has not removed the fears concerning a Brexit. The fact that prominent members of the Conservative Party have announced that they are going to be campaigning for Britain's exit from the EU has increased investors' worries over such a possibility". Since the beginning of the year, the pound has lost 4.1%. On Friday night, David Cameron has achieved a special agreement that grants the United Kingdom "a special status in the European Union", but has announced that he has not abandoned the idea of a referendum concerning the United Kingdom's exit from the EU, and set the date of the poll to June 23rd. 

 Following the capital deficit of almost 8 billion Euros, the regulator of the Austrian financial market (FMA) has imposed a moratorium on the payment of the debts of Heta on March 1st, 2015, which will expire on May 31st, 2016.  "The Finance Ministry has said that Heta is not insolvent, and the guarantees offered by Carinthia and the federal government for Heta's debts will not be affected by the decision", Reuters wrote at the time. The suspension of the payments of Heta has been justified by the need to draw up a resolution plan, which would ensure equal treatment of all creditors, according to the press release of the FMA.  Back in 2015, the Austrian Finance Minister said that the bail-in procedure will also be applied to creditors, as the Bank Recovery and Resolution Directive (BRRD) was transposed into the country's national legislation and came into effect on January 1st, 2015.  Now, honoring the government's debt doesn't seem to matter in Vienna anymore, and judging by his own statements, the minister of finance is convinced that the financial situation of the country and its borrowing costs will not be affected.  Unfortunately, reality, in particular the one that is giving the European authorities nightmares since the beginning of the crisis, does not "bend" to political will. Frances Coppola further writes that "Carinthia's insolvency will lead to a heavy fiscal adjustment for Austria, amid an increase in borrowing costs", and the "value of no risk investments will see a massive drop, because government can no longer be considered safe". "The implications, not only for the financial stability of Austria but for that of Europe as well, are terrible", the Forbes journalist concludes. If we also add in the uncertainties concerning the application of the bail-in framework, it is almost certain that Europe will need bigger crises than the Brexit and the refugees' "cover" the growing cracks in its financial foundation. 

The Austrian authorities have taken yet another step on the mined field of financial "stability" of the so-called hard core of the Eurozone. Amid the nearing of the deadline for the moratorium set on the payment of the debts of Heta Asset Resolution, the bad bank set up for the takeover of the non-performing land of Hypo Alpe-Adria, the creditors have been presented with the buyback terms for the bonds guaranteed by the land of Carinthia. Their total par value is 11 billion Euros, and the "offer" includes the payment of 75% of the par value for senior bonds and 30% of the value of subordinated bonds, which means a total loss of approximately 3.2 billion Euros for lenders. "Creditors that refuse the offer could wait for as long as ten years for a ruling of the judicial system in their favor", said Hans-Joerg Schelling, the Austrian finance minister, according to Bloomberg. Schelling further said that "the offer is excellent", according to Bloomberg, and creditors "should be rational and accept it". For the buyback of the Heta bonds, Austria has set up a special investment vehicle, Kaerntner Ausgleichszahlungs-Fonds (The Fund for the Payment of Compensations of Carinthia). Unfortunately for the authorities in Vienna, the notion of "rational" is understood differently by creditors. "What the Austrian authorities have done is unprecedented in the developed world: they have announced a figure that they consider acceptable and they have asked the creditors to accept the offer", the partner of Swiss company Gold Partners AG who owns 200 million Euros worth of Heta bonds, told Bloomberg. The list of creditors that oppose the offer includes far bigger names however, such as German banks Commerzbank AG and NordLB, as well as PIMCO, the American investment fund manager owned by Allianz AG.  Bloomberg estimates show that the exposure of those who have rejected the proposal of the Austrian authorities is about 5 billion Euros and represents approximately 45% of the total debt, as the terms of the offer are non-negotiable, and its acceptance by two thirds of the creditors involves its unconditional application and for the other creditors as well.