BRUSSELS – Big banks across Europe will have to raise 106 billion euros ($148 billion) to better withstand the turmoil of the debt crisis, preliminary figures showed, while eurozone leaders neared a deal to boost their bailout fund to over 1 trillion euros, a senior official said Wednesday.

The deal to force banks in the European Union to boost their rainy-day funds amid worsening market turmoil is a key part of a broader plan to solve the debt crisis that leaders have promised.

It was, however, only one third of a broader strategy expected to also include reducing Greece’s debt load and boosting the eurozone’s bailout fund.

After much delay, talks on the bailout fund finally saw some progress. The leaders of the 17-country eurozone want to give the fund, the 440-billion-euro European Financial Stability Facility, more firepower so it can keep the crisis from reaching big countries like Italy and Spain. The question was how to do it with the most impact and least risk for taxpayers.

A eurozone official said consensus was emerging to allow the EFSF to insure private investors against the first 25 percent of losses on purchases of government bonds and other investments linked to helping the eurozone.

After contributing to the bailouts of Ireland, Portugal and Greece, the EFSF will have only about 270 billion euros left. A scheme to provide insurance on bond issues could multiply the impact of the EFSF’s lending power to over 1 trillion euros, the official said, since it would make those bonds safer investments and attract demand.

The official, speaking on condition of anonymity, cautioned however that the EFSF leveraging would not be agreed upon until other parts of the plan were nailed down.


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