Europe’s plan to address weak banks risks unraveling

And a new study presented at the European Cancer Conference (ECC) in Amsterdam at the weekend showed men experience more harm than good from routine prostate cancer screening tests. In bowel cancer screening, however, the risk of over-diagnosis is very low, while gains in terms of reducing deaths are large – making routine testing cost-effective, Philippe Autier, a professor at France’s International Prevention Research Institute (IPPR), told the conference. “There is now an irrefutable case for devoting some of the resources from breast and prostate cancer screening to the early detection of colorectal (bowel) cancer,” he said. A large European study published last year found that breast screening programs over-diagnose about four cases for every 1,000 women aged between 50 and 69 who are screened. The IPPR’s research director Mathieu Boniol, who studied the impact of prostate screening, said his results showed routine use of prostate-specific antigen (PSA) tests creates more harm in terms of incontinence, impotence and other side-effects from prostate cancer treatments than benefit in terms of detecting life-threatening cancers. “PSA testing should be reduced and more attention should be given to the harmful effects of screening,” he told delegates. Meanwhile, results of a study conducted by Autier using data from 11 European countries between 1989 and 2010 showed that the greater the proportions of men and women routinely screened for bowel cancer, the greater the reductions in death rates. Colorectal cancer kills more than 600,000 people a year worldwide, according to the World Health Organization. In Europe some 400,000 people are diagnosed with the disease each year. In Austria, for example, where 61 percent of those studied reported having had colorectal screening tests, deaths from this form of cancer dropped by 39 percent for men and 47 percent for women over the decade. Meanwhile in Greece, where only 8 percent of males had had bowel cancer screening, death rates rose by 30 percent for men. In the light of the results, Cornelis van de Velde, an oncologist at Leiden University Medical Centre in the Netherlands and president of the European Cancer Organisation, said it was “very disappointing” there are such wide differences in European governments’ approaches to colorectal screening. “People over 50 should be informed of the availability of the test, and pressure should be put on national health services to put more effort into organizing screening programs,” he told the conference.

“The small banks have bigger problems than the large ones.” OUT ON A LIMB Germany, the euro zone’s strongest economy, which has shouldered much of the burden for country bailouts, does not want a scheme that leaves it on the hook. That aversion is unlikely to change, whatever the outcome of current government coalition talks. Berlin has suggested that a bank resolution agency should only have power over the euro zone’s largest lenders. That would reduce any potential bill to be shared by the 17 euro zone countries, but such a deal could mean that small risky banks, at the heart of the current crisis, slip through the net. The absence of a financial backstop to help banks once their problems are laid bare may prompt the ECB to delay the tests of banks altogether, a move that could postpone supervision and damage the euro zone’s image internationally. The situation would be even worse if haggling between EU governments delays agreement – now penciled in for December – on the ‘resolution’ framework to cope with laggard banks. That would have a knock-on effect on talks to finalize the regime with the European Parliament, potentially leaving the ECB out on a limb when it takes on supervision, as now planned, towards the end of next year. “We will not start before governments have agreed on a backstop – emergency funding for capital holes – which we might find in the balance sheets,” Yves Mersch, the member of the ECB’s executive board in charge of supervision, said on Monday, referring to the bank balance sheet checks. “This has nothing to do with sitting something out, but with responsibility,” he said. “This assessment could throw us back into crisis, without clarifying the financing beforehand.” Putting off the day of reckoning could make the months ahead easier but would likely come at a heavy cost for the ECB, which has already lent the banks over a trillion euros in cheap funding, mostly now repaid, and is expected to open the taps again, possibly by the end of this year. Most agree there cannot be a repeat of the two earlier stress tests, widely considered flops for a series of blunders, including giving Irish banks a clean bill of health months before their problems pushed the country into an international bailout. Ex-ECB man Papadia warned of the consequences should “the ECB get scared” and soften its assessment of banks. “The risk of this is that you would continue with the opacity …