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French banks need 10-bln-euro infusion but no public help: PM

10-26-2011 09:00 BJT

PARIS, Oct. 25 (Xinhua) -- French banks, hit hard by Greek debt crisis, will need 10 billion euros (13.9 billion U.S. dollars) to be recapitalized but without involving the help of public finance, French Prime Minister said on Tuesday.

The banks need to raise their core capital ratio to 9 percent in order to confront the region's sovereign debt turmoil, Francois Fillion told deputies at the National Assembly.

"Concerning France, I can say that this recapitalization would be at the level of 10 billion euros," Fillion said during a weekly debate in the National Assembly.

"French banks have to be recapitalized without needing the help of public finances," he added.

Fillion's remarks on public finances emerged like a signal to soothe concerns over the safety of taxpayers' money as European policy makers generally agreed on the need to recapitalize European banks to fence them against debt crisis impact, especially after the nationalization of troubled Dexia bank.

On Monday, French central bank governor Christian Noyer said domestic banks are in need of less than 10 billion euros to compensate losses led by high exposure to Greece.

Leaders of the 17 eurozone states pledged to finalize on Wednesday an agreement including measures crucial to stem sovereign debt crisis contagion in the region and quell investors' rising worries.

Banks suffered heavy loss during the last three months. Persistent concerns over Societe Generale's short-term funding in particular pulled down the bank stocks by 47.62 percent over the period.

Editor:Wang Xiaomei |Source: Xinhua

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