EU Leaders Pledge to Do `Whatever' Needed to Protect Depositors

By Steve Scherer

Oct. 6 (Bloomberg) -- European Union leaders pledged to protect depositors from losing their savings and to support the financial system as shares tumbled across the region today.

EU countries ``will take whatever measures are necessary to maintain the stability of the financial system,'' according to a joint statement by the 27 EU member countries that was released today by Italian Prime Minister Silvio Berlusconi's office. ``We will continue to take the necessary measures to protect the system so that individual depositors in our countries' banks do not suffer any loss of money.''

Today's statement focuses on safeguarding people's savings as the banking crisis in Europe deepens. The German government yesterday announced a bailout plan for its second-biggest real- estate lender, and BNP Paribas SA agreed to buy Fortis's units in Belgium and Luxembourg.

Europe's main stock exchanges were all down more than 4 percent at 3 p.m. in Paris, and the Bloomberg 500 Europe Banks and Financial Services Index had dropped 6.1 percent. The euro also suffered its biggest one-day drop against the yen since its 1999 debut, and fell to a 14-month low against the dollar.

Finance ministers from the 15 countries that use the euro meet later today in Luxembourg, and the rest of the EU finance ministers will join them tomorrow.

To contact the reporters on this story: Sandrine Rastello in Paris at srastello@bloomberg.net.