IMF chief expects financial sector to shrink

CAIRO: The head of the International Monetary Fund Dominique Strauss-Kahn said on Monday he expected the global financial sector to shrink as a result of the international credit crisis.

"The financial sector, not only in the US but also in the rest of the world, will be at the end of the crisis smaller than the financial sector today," Strauss-Kahn told reporters in Cairo.

"The financial sector will shrink," he said, expecting "a phase of consolidation of the financial sectors." He spoke amid fears of a domino effect in the global financial system after troubled investment giant Lehman Brothers sought bankruptcy protection.

Strauss-Kahn was in Egypt for talks with officials, including President Hosni Mubarak, on the country's economic reform programme.