Germany, France deny plans for European bank fund
Posted by Job on October 6, 2008
ROME, Oct 5 (Reuters) – German and French officials denied on Sunday that they were set to endorse a common fund to bail out European banks after Italian Prime Minister Silvio Berlusconi was quoted as saying all three nations would back it.
“There’s no proposal for such a fund,” said a French official, who spoke to Reuters on condition of anonymity. Officials in Berlin and London also denied plans for a European Union-wide bailout.
“There’s no change from the statement issued on Saturday,” the French official added, referring to a joint statement the leaders of France, Germany, Italy and Britain issued after they met in Paris on Saturday — a statement that made no mention of a fund.
Berlusconi was quoted by Italian agencies as saying that his economy minister, Giulio Tremonti, would propose setting up the fund at a meeting of EU economic and finance ministers in Luxembourg on Monday and Tuesday, and that the plan was already assured the backing of Germany and France:
“Tremonti will propose to Ecofin the setting up of a common fund worth 3 percent of GDP … Yesterday (German Chancellor Angela) Merkel couldn’t accept because she didn’t have the powers, today she has said she agrees. Tomorrow France will do the same.”
But German Finance Ministry spokesman Torsten Albig said Germany remained opposed to a common fund to bail out Europe’s banks.
“This was an issue in Paris and there is no need to go over it again,” Albig said. Asked whether Germany supported the latest Italian proposal, Albig said: “No. Nothing has changed.”
Berlusconi said that he was confident that Britain would also agree, ANSA news agency reported.
But a British finance ministry official, asked about Berlusconi’s reported comments, referred to Prime Minister Gordon Brown’s statement on Friday that there was “no currency” to the suggestion of a European-wide fund. (Reporting by Gavin Jones in Rome, Brian Love in Paris, Iain Rogers in Berlin and Matt Falloon in London; Writing by Dominic Evans; Editing by Kevin Liffey)