European leaders vow to fight financial crisis

By Anna Willard and Brian Love

PARIS (Reuters) - European leaders vowed after crisis talks on Saturday to do all they could to fend off the financial mayhem that has snowballed out of Wall Street and is now hitting banks in Europe.

As they did so, German property lender Hypo Real Estate said it was "fighting for survival" after a government-backed rescue unravelled, and Belgium was seeking a buyer for what remained of beleaguered bank and insurance group Fortis after the rest was nationalised by the Dutch government.

"We jointly commit to ensure the soundness and stability of our banking and financial system and will take all the necessary measures to achieve this objective," the leaders of France, Germany, Britain and Italy said in a statement.

For a text of the statement please click on

The statement, after talks of about three hours, was more a declaration of principle and call for coordination of national responses than an announcement of instant new measures to deal with the worst financial crisis since the 1930s.

They urged the European Commission to produce legislative proposals in the near future on bank deposit insurance in the European Union and urged immediate establishment of cross-border supervisory colleges to improve cross-border surveillance.

French President Nicolas Sarkozy, who called the emergency meeting, said governments needed to act in a coordinated manner.

But he said he had never gone as far as to propose a pan-European rescue fund for banks -- something Berlin had balked at when talk of it surfaced a few days ago.