Europe rushes to save failing banks
STOCKHOLM: Governments across Europe scrambled to save failing banks on Sunday, working largely on their own a day after leaders of the continent’s four biggest economies called for tighter regulation and coordinated response to the global meltdown.
The German government held crisis talks after the collapse of a ballyhooed €35-billion bailout of Hypo Real Estate AG, the country’s second biggest property lender. German Chancellor Angela Merkel said Europe’s biggest economy would “not allow the distress of one financial institution to distress the entire system.”
In Iceland — particularly hard-hit by the credit crunch — government officials and banking chiefs were discussing a possible rescue plan for overstretched commercial banks. Belgian Prime Minister Yves Leterme said he aims to find a new owner for troubled bank Fortis NV to restore confidence in the company before the opening of markets on Monday. Mr. Leterme said government officials were going over a takeover bid for Fortis’ Belgian operations. The bank’s Dutch operations were nationalised amid fears they could go insolvent.