In a fresh plea for aid from the European Central Bank (ECB), nine leading international banks that operate in central and eastern Europe have joined forces in asking for greater help in the region.
The banks argue that funds to boost liquidity and restart lending should not be limited to the new EU member states however, but instead should also be offered to states beyond the bloc, such as Serbia and the Ukraine, reports the Financial Times.
"We fought for 50 years, many of us, to get these countries away from communism and now we have a free market economy in the region, we can't leave them alone when there is an extremely harsh wind blowing," Herbert Stepic, chief executive of Raiffeisen International told the newspaper.
The Austrian bank was chiefly responsible for bringing the group together.
The other eight banks involved are Italy's Unicredit and Intesa Sanpaolo, Austria's Erste Bank, Societe Generale from France, Belgium's KBC, German Bayern Landesbank, Sweden's Wedbank and EFG Eurobank from Greece.
Mr Stepic's remarks come after the European Commission announced fresh economic forecasts on Monday (19 January) that predicted EU GDP would contract by 1.8 per cent this year, while on Wednesday, Portugal became the third eurozone member to have its rating cut by ratings agency Standard & Poor's.
Responding to further calls for a greater ECB supervisory role in Europe's financial sector, the bank's president, Jean-Claude Trichet, reiterated that the present EU treaties already contained a clause enabling member states to ramp up any of the bank's powers.
Speaking to members of the European Parliament, Mr Trichet said that he personally "stood ready" to take on new banking supervision responsibilities but pointed out that the governing council, which includes representatives from all 16 eurozone members, had yet to agree a common position.
Former Banque de France governor Jacque de Larosiere currently heads an expert panel in Brussels that has been asked to draw up proposals for a European financial supervisory system.
It is due to report its conclusions at the end of February.
Provided by EUobserver—For the latest EU related news