French government in 10.5 billion euro bank bailout
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The French government has agreed to pump 10.5 billion euros into the country's six largest banks in exchange for guarantees on lending to households and firms, Finance Minister Christine Lagarde said on Monday.
The French government will inject 10.5 billion euros (14 billion dollars) into the country's six biggest banks, Finance Minister Christine Lagarde said on Monday.
Among the beneficiaries, the biggest bank Credit Agricole will get three billion euros, BNP Paribas will get 2.55 billion and Societe Generale will get 1.7 billion, in moves to support lenders hit by the financial crisis.
Credit Mutuel will receive 1.2 billion, Caisse d'Epargne 1.1 billion and Banque Populaire 950 million, to ensure banks are "able to finance the economy correctly," Lagarde told reporters after meeting with the heads of the banks.
French lawmakers last week approved a 360-billion-euro package to rescue banks. Several European countries had agreed to plough capital into the hardest-hit banks and massively underwrite loans between financial players.
Under the plan, the French state provides 40 billion euros to recapitalise fragile banks -- the source of the payouts agreed on Monday night.
Last week's plan also provides for up to 320 billion euros in inter-bank loan guarantees to overcome the credit crisis.
President Nicolas Sarkozy has pledged that no French bank will be allowed to collapse and that savers will not lose "a single euro" in the global turmoil unleashed by the collapse of US investment giant Lehman Brothers last month.