Barroso echoes Trichet warning on 'systemic crisis'

The president of the European Commission has warned the eurozone's banking system needs to be fully recapitalised to ward off a systemic crisis, at cost of hundreds of billions of euros.

Jose Manuel Barroso argued €200bn needs to be injected into European banks, adding the package must be quickly accepted by ministers, the Telegraph reports. "A solution to break the vicious cycle between doubts over the sustainability of sovereign debt, the stability of the banking system and the EU's growth prospects is more necessary than ever," said Barroso. "Banks should be required to implement temporary significantly higher capital ratios and lenders unable to meet the new standard should be forced to raise more money either through private capital raisings or direct injections ...