Bloomberg News

European Bank Shares Rise as Greece Passes Measures for Rescue

February 13, 2012

Feb. 13 (Bloomberg) -- European bank shares rose after Greek lawmakers approved austerity measures needed for the country to gain an international bailout.

The 43-member Bloomberg Europe Banks and Financial Services Index climbed 1.3 percent by 9:20 a.m. in Frankfurt. Commerzbank AG and Credit Agricole SA and led the increase, adding 5.5 percent and 3.9 percent respectively.

“Greece is the trigger for why banks with a higher exposure to the country’s bonds are doing well,” said Ingo Frommen, a European banking analyst at Landesbank Baden- Wuerttemberg. “The passing of the measures could also help avoid bigger writedowns on the debt.”

Greek Prime Minister Lucas Papademos won approval in Athens of a bill on austerity measures to secure a second bailout package from the European Union and International Monetary Fund. A total of 199 lawmakers voted in favor and 74 against, Parliament Speaker Filippos Petsalnikos said in remarks carried live on state-run Vouli TV.

Greece “will be saved in one way or another,” German Finance Minister Wolfgang Schaeuble told newspaper Welt am Sonntag yesterday, though the country must “do its homework.”

Euro-area finance ministers will convene in Brussels on Feb. 15 in an extraordinary meeting that was set after they declined in a special session on Feb. 9 to ratify the 130 billion-euro ($172 billion) rescue package. Frustrated after two years of missed budget targets, the European authorities demanded Greek officials put their verbal commitments into law.

--Editors: Frank Connelly, Dylan Griffiths

To contact the reporter on this story: Nicholas Comfort in Frankfurt at ncomfort1@bloomberg.net

To contact the editor responsible for this story: Frank Connelly at fconnelly@bloomberg.net


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