"The Council shares the view that risks of competitive distortion between banks whose funding is obtained at market prices and banks strongly relying on government guarantees persist," draft conclusions of the ministers' meeting showed.
The ministers, who meet on Monday and Tuesday in Brussels, will say they believe it was appropriate to apply an adequate increase of the guarantee fees in order to bring funding costs closer to market conditions.
"The Council [...] urges the application of new conditions as from July 2010," the draft conclusions, obtained by Reuters, said.
"The Council also agrees that, at the current juncture, access to liquidity in markets is generally less difficult than it was in the most acute crisis period and that cases of extended use of government guarantees should be monitored," the draft said.
EU governments have pledged guarantees on bank liabilities of 2.9 trillion euros, or 25% of EU GDP, of which one trillion euros or 8% of GDP has been granted.
The guarantees are the biggest item on a list of government measures to keep financial markets going after lending between banks froze following the collapse of investment bank Lehman Brothers in September 2008.
Governments in the 27-nation EU pledged public support to the banking system worth 43.6% of GDP, or 5.1 trillion euros in total - including capital injections, guarantees on bank liabilities, toxic asset relief and liquidity and bank funding support.
In the end, only 12.8% of GDP was used by banks.
(EurActiv with Reuters.)
