Europe’s leaders have finally agreed a euro zone rescue plan after marathon talks lasting more than eight hours.
The main points of the discussions surround three issues – the recapitalisation of the banks. This will act as a firewall against contagion from debt ridden countries.
The second area is a bank 50 per cent write-off of Greek debt with the remaining possibly being given preferable rates of interest.
And the third being the boosting of the bail out fund. The EFSF was previously 440 billion euros but through offering insurance to purchasers of euro zone debt or via a so called special purpose investment vehicle this will be boosted to one trillion. The latter aims to attract investment from China and Brazil.