Pressure on Italy, Spain as EU outlines bank deal

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VOV News English - 35 month(s) ago 2 readings

Pressure on Italy, Spain as EU outlines bank deal

EU finance ministers framed a deal on Saturday for recapitalizing European banks, and the leaders of Germany and France said they hoped for a breakthrough in tackling the euro zone debt crisis at a summit on Wednesday.

After nearly 10 hours of talks, finance ministers overcame strong opposition from Spain, Italy and Portugal and agreed on the need to inject around 100 billion euros into European banks to protect them from the threat of a Greek debt default, and the broader risks of financial contagion in the euro zone.

The ministers will submit their thoughts to EU leaders, who meet on Sunday to discuss a "comprehensive" solution to the debt crisis, which needs to contain a second bailout programme for Greece, a scaling up of the euro zone's bailout fund, and the strengthening of European bank balance sheets.

No headline deal is expected from Sunday's meeting, but German Chancellor Angela Merkel said she was hopeful that another euro zone summit scheduled for Wednesday would produce definitive results and France's Nicolas Sarkozy agreed.

"We have to take far-reaching decisions," Merkel told reporters ahead of a pre-summit meeting near Brussels. "I believe that the finance ministers made progress, so that we can achieve our ambitious targets by Wednesday."

Reuters

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