Second bailout for Greece looms

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Second bailout for Greece looms

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Nicolas Sarkozy and Angela Merkel are calling for a quick deal on a second bailout for Greece after a meeting in Berlin. Merkel favours a scheme whereby banks and private creditors should accept some losses.

She said: “The main principal is a voluntary participation from the banks. That’s an important message for the banks because there are worries that we’re starting a credit crisis and we don’t want to take that risk.”

Sarkozy is reluctant to see French banks accepting any losses but stressed that France and Germany stood shoulder to shoulder on the issue and were agreed that a solution had to be found as soon as possible.

He said: “We want to act as soon as possible, without fixing a date, but September wouldn’t be “as fast as possible” and we’ll have other concerns in August, and as we’re already half way through June, so “as soon as possible” probably means July…”

The meeting came ahead of talks on Sunday to agree a second bailout package for Greece, which is needed to release the next 12 billion euros of the original bailout package.