Oct. 16 (Bloomberg) -- German Finance Minister Wolfgang Schaeuble said the reduction of Greece’s debt by means of private sector participation must be bigger than agreed in July by euro region leaders in order to achieve a “sustainable solution” for the over-indebted country.

There will be negotiations with the banking sector about a debt cut for Greece, Schaeuble said on ARD public television. A transcript of the interview was e-mailed by ARD.

“It is clear that there has to be a private sector involvement that’s sufficient for a sustainable solution for Greece,” ARD quoted Schaeuble as saying. Fighting contagion dangers in financial markets is “at least as important,” he said.

There are contagion risks in the banking sector and banks need to be equipped with the “necessary” capital, he said.

To contact the editor responsible for this story: Rainer Buergin at rbuergin1@bloomberg.net