European Banks Needs 100-Bln-Euro Recapitalization Due to Greek Crisis: French Minister

PARIS, Oct. 25 (Xinhua) -- French Finance Minister Francois Baroin estimated Monday European banks to be recapitalized need about 100 billion euros (138.6 billion U.S. dollars) to absorb any potential financial shock.

In an interview with local broadcaster Europe1, Baroin said the agreement on banks recapitalization could be signed on Wednesday during a meeting of 27 Euroepan Union states.

"The figure of 100 billion, a little more or a little less but it's of that order. (The banks) will do so on the basis of their balance sheets," the French minister said.

The new capital will help shaky banks to reach 9 percent core tier 1 capital ratio in June next year, Baroin noted.

Finance ministers of the European bloc agreed to give banks until June 2012 to realize this capital ratio by using their own funds or aid from private investors. If that procedure fails, banks could use public money from governments or the European Financial Stability Facility (EFSF).

Admitting Greek debt crisis "serious" and "threatening," Baroin stressed the need to be "accurate," "determined" and "coordinated" to cope with the crisis challenges.

"We know where we go. We know we do not want that Greece will go bankrupt ... After this crisis, Europe's budgetary and fiscal convergence would be inevitable," the minister said.

Leaders of the eurozone pledged to reach on Wednesday a final agreement and forge concrete measures to stem sovereign debt crisis contagion in the region and restore markets confidence.

When inquired about the risk that France's sovereign debt rating of triple A could be downgraded, the French minister said a Europe-wide agreement would hopefully be able to stabilize all economies, including that of France.

Last week, Moody's warned France on possible negative outlook in the next three months as its help to bailout eurozone ridden countries could stretch further its deficit and make it harder to meet growth and gap targets.