Euro zone finance ministers consider more losses for banks after it becomes clear a planned second Greek bailout will not fill the hole in Athens' accounts.
Below are the main developments in the euro zone's intractable debt crisis today.
- Euro zone finance ministers say they will review the losses imposed on banks as part of a planned second Greek bailout after Athens admitted it will miss key deficit targets, meaning the aid package may prove insufficient.
- The ministers agreed Greece could wait until mid-November before it receives more funds. Officials in Athens had previously said money would run out a month earlier than that. The extension suggests plans are afoot for something more profound than merely paying out the next €8 billion loan tranche in six weeks' time.
- Greek bank shares shed more than than 7 per cent on increased default worries and the euro hit a nine-month low versus the dollar. Germany's five-year credit default swaps hit record highs, on expectations it will have to cough up increasingly more funds to bail out weaker southern states in the euro zone.
- The finance ministers also discussed ways to leverage the bloc's EFSF bailout fund to give it more firepower. Eurogroup chairman Jean-Claude Juncker said involving the European Central Bank was not "part of our considerations". One of the main options that could work would be to allow the EFSF to refinance itself at the ECB's liquidity operations for banks.
- A months-long dispute over Finnish demands for collateral for new loan guarantees for Greece was resolved.
- Shares in Franco-Belgian bank Dexia plunge 20 per cent on concerns about its heavy exposure to Greece and a Moody's warning about its liquidity. Belgian Finance Minister Didier Reynders said France and Belgium were poised to act if necessary.