Rome: Italy will resurrect the idea of creating an European bank bailout fund at a meeting of EU finance ministers in Luxembourg today, Prime Minister Silvio Berlusconi said.

While the idea of creating a European fund to match the 700-billion-dollar bailout package approved by the United States failed to gain traction at a weekend mini-summit leaders of European leaders in Paris, Berlusconi said minds had changed.

On Saturday in Paris German Chancellor "Angela Merkel couldn t accept" the proposal "because she didn t have the power. Today, on the contrary, she said she agreed. France will do the same," Berlusconi was quoted as saying by the ANSA news agency yesterday.

Germany had before the summit made clear its opposition to the idea of creating a 300-billion-euro European fund, preferring for countries to act on their own to save failing banks on a ad-hoc basis.

However, Germany was also forced to reverse its opposition to guaranteeing bank deposits, yesterday providing a blanket guarantee to all checking and savings accounts.

Berlusconi said that Italian Economy Minister Giulio Tremonti would make the proposal for the fund, worth about three per cent of gross domestic product, at the meeting today in Luxembourg of EU finance ministers.
Source : PTI