Bank of France governor reassures on French banks
The Bank of France governor struck a reassuring tone on Tuesday about the ongoing financial crisis, calling for calm before a meeting of the country's top bankers with President Nicolas Sarkozy.
By Agencies |
PARIS: The Bank of France governor struck a reassuring tone on Tuesday about the ongoing financial crisis, calling for calm before a meeting of the country's top bankers with President Nicolas Sarkozy.
In an interview on radio station RTL, Christian Noyer said ``we are having difficulties, but we must have total confidence in the safety of the French banking system. In these circumstances we must keep a cool head and reason objectively. We must stop collectively frightening ourselves.''
Belgium, France and Luxembourg, meanwhile, said they would inject almost euro 6.4 bn (US$9.2 bn) into French-Belgian bank Dexia, which closed nearly 30 percent lower Monday. The French government, via its investment arm CDC, will invest euro3 bn (US$4.3 bn).
Together, the French state and CDC will have a combined stake of more than 25 per cent in the bank once the operation is completed, Sarkozy's office said in a statement.
Noyer added that ``there are difficulties, which everyone knows, but there is absolutely no reason to be afraid or to panic.''
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France's banks ``have been touched by the crisis on financial markets ... but (French banks) are not overloaded with bad assets like a certain number of American banks were,'' Noyer said. ``Fundamentally, they are solid.''Sarkozy will meet with the heads of France's major banks and insurance companies Tuesday to review the state of the nation's financial institutions. Prime Minister Francois Fillon and Finance Minister Christine Lagarde will take part, as will Noyer.
The meeting will also focus on the availability of loans to households and businesses.
Noyer said Sarkozy has made it ``perfectly clear'' that ``if there is a problem, states, governments must be absolutely determined to ensure that the financial system holds up.''
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Asked about the failure of U.S. legislators to pass a $700 bn bailout bill Monday, Noyer said it was ``bad news,'' and added that ``the Americans don't have a choice, they must absolutely have a global plan.''Download
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