France urges banks to join Greek bailout efforts

3rd May 2010, Comments 0 comments

French Finance Minister Christine Lagarde on Sunday called on banks to participate in the emergency efforts to bail Greece out of its debt crisis, calling it "an exercise in solidarity".

"I hope everyone will examine what they can do and I expect the financial sector to also consider what it can do," Lagarde said as she arrived for talks with her eurozone counterparts in Brussels.

The ministers were gathered to endorse an unprecedented bailout plan for Greece which could total some 110 billion euros (146 billion dollars) over three years including loans from the International Monetary Fund (IMF).

"It's an exercise in solidarity," Lagarde stressed.

"Everyone has a clear interest in ensuring that Greece is stable... that the markets have confidence in Greece," she said.

In Germany the government is also trying to convince major lenders to invest in Greek debt, something which could help restore confidence in a market which has plummeted to near junk bond status.

Lagarde underlined that the Greek aid plan was aimed at "ending the volatile movement (of the markets) which are very bad for the country and for the euro," which Greece shares with its 15 eurozone partners.

However the French minister played down the risks of market contagion already seen in other euro nations, saying that "Greece, Portugal, Spain, Italy and the others are different cases."

"Greece is really unique," she insisted, not least due to its lax fiscal statistics.

She said that the austerity plan announced by Athens on Sunday as a condition of the EU/IMF money was "very firm".

But the deficit in confidence must also be addressed, said Lagarde.

Greece must stick to its promises and "we must verify that it does stick to them," she added.

© 2010 AFP

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