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German Chancellor Angela Merkel announced the rescue package for the financial markets to be agreed in fast track procedure by the end of this week.
The package consists of a € 400 billion Financial Market Stabilization Fund to guarantee the stability and functioning of the interbank lending market. Additionally, the government provides € 80 billion for the recapitalization for banks.
Merkel also announced new accounting rules to be available immediately so financial companies can make use of them already in the 3rd quarter 2008.
German Finance Minister Steinbrück also announced measures concerning the remuneration of managers for those financial institutions who need financial help. Although there is an agreement in principle, the exact content is not yet agreed. However, managers of these institutions should not earn more than € 500.000 per year and should not receive any bonuses or any form of golden parachute, he said.
French President Sarkozy announced the French package which comprises a € 320 billion guarantee fund plus and additional € 40 billion for recapitalization for banks.
Spanish President Zapatero said his country would provide up to € 100 billion of guarantees for new debt issued by commercial banks in 2008 and an unspecified further amount next year. Mr Zapatero had previously announced a temporary € 30 to 50 billion fund to buy bank assets.
The Austrian government announced a € 100 billion package which includes € 85 billion guarantee fund plus a € 15 billion for recapitalization purposes.
German chancellor Merkel underlined that the package is a first step towards a new financial market order. This new order will include the following areas:
These announced international initiatives will be debated in international Foras during the coming weeks in the forthcoming European Council on 15-16 October, the EU-Canada summit on 17 October, the EU-Asia meeting in
Press release on reporting issues (German only)
French package – Press release (French only)