ECB President Mario Draghi has kicked back a proposal from advisors to change the way sovereign debt is risk-weighted and asked them to do some more work on it, German weekly news magazine Spiegel reported. The euro zone’s sovereign debt crisis has highlighted the dangers of banks buying its government bonds as a theoretically safe buffer against risky investments, particularly since holders of Greek bonds took a hit in the country’s bailout. The measures suggested by the advisors could have a big impact on how crisis-stricken states finance themselves in the future.
