European finance crisis summit opens in Paris

PARIS, October 12, 2008 (AFP) – European leaders opened a summit in Paris on Sunday to try to agree on decisive measures to confront the global financial crisis.

President Nicolas Sarkozy predicted that “an ambitious, coordinated” plan would emerge from the meeting held nearly a month after the collapse of US investment giant Lehman Brothers set off a world share crash.

British Prime Minister Gordon Brown was to address leaders of the 15-nation eurozone and explain his plan to protect British banks that has emerged as a model for action to address the meltdown.

Brown’s government has set aside 250 billion pounds (315 billion euros) to guarantee inter-bank lending, 200 billion pounds in short-term loans and 50 billion to buy stakes in major banks.

Buying equity stakes in banks and offering sovereign guarantees for loans were seen as vital to shore up confidence in financial institutions and end panic-selling on the stock markets.

European markets posted huge losses at the close of trade on Friday after a whirlwind week that battered key indexes. London’s FTSE 100 index plunged 21.05 percent from the end of trading seven days earlier while t