Penalising eurozone banks that hoard cash may help

TARGETED bank-bashing could be the answer to Mario Draghi's conundrum. In order to maximise the impact of his plan to ease monetary policy, the European Central Bank president needs to make a big splash in financial markets.

But one of the ways of doing this, a chunky cut in the deposit rate, would hurt banks. Cue a bright idea.

Officials say the ECB is considering introducing a two-tier penalty charge on banks which hoard cash, according to a Reuters story published on Nov 25.