Sarkozy pledges French bank support, calls meeting

Mon Sep 29, 2008 12:37pm EDT
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By Jean-Francois Rosnoblet

MARSEILLE, France (Reuters) - President Nicolas Sarkozy repeated on Monday a pledge to protect French bank deposits from any losses in the financial market crisis, and called a meeting of bank and insurance bosses to discuss the situation.

"We must not give way in the face of destabilization. We have to support the banks," he told a joint news conference with Indian Prime Minister Manmohan Singh and European Commission President Jose Manuel Barroso.

The comment came as shares in French bank Dexia sank on a report that it might need emergency capital and after a string of bank rescue deals in the Benelux countries, Britain and Germany.

Earlier on Monday, Sarkozy's office announced that he had summoned the heads of the main French banks and insurers to a meeting at the Elysee Palace "aimed at reviewing the situation of financial institutions as well as the distribution of credit to households and companies."

The meeting would be held on Tuesday at 0830 GMT and would also be attended by Bank of France Governor Christian Noyer, Economy Minister Christine Lagarde and Prime Minister Francois Fillon, a statement from his office said.

Speaking in Marseille, he said intense contacts between European capitals had been underway to discuss the crisis.

He also confirmed a promise he made in a speech last week in the city of Toulon that he would ensure that French depositors did not lose a single euro if any French bank got into trouble.

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<p>France's president Nicolas Sarkozy delivers a speech during a news conference at the end of the EU-India summit in Marseille September 29, 2008. REUTERS/Jean-Paul Pelissier</p>