European banks on lookout for sweeteners

FRANKFURT: Banks are waiting to hear how Mario Draghi (pic) plans to sweeten the bitter pill of more interest-rate cuts.

The European Central Bank president says if rates are reduced further below zero, as looks likely because of economic weakness, measures may be needed to prevent the policy from squeezing lenders’ profitability so much that they pull back. Financial institutions have long complained that they can’t pass on the cost - a charge on their overnight reserves - to their depositors.