Eurogroup head voices relief at US Senate vote on bailout

(FRANKFURT) - The chair of the Eurogroup of eurozone finance ministers Jean-Claude Juncker said Thursday he was very relieved that the US Senate had adopted a plan to bail out the banking sector.

"I am very relieved that the Senate hurdle has been passed," Juncker told Deutschland Radio after US senators passed a 700-million-dollar (500-million-euro) bill to buy risky securities from banks to get the lending sector moving again.

Juncker, who is also the prime minister of Luxembourg, called for the US House of Representatives to quickly add its stamp of approval to the legislation.

He said that the US plan would "certainly help calm markets."

But he added that a similar plan, which some have urged European officials to draw up, was "not necessary in Europe" because the banking sector there was "more stable" in his opinion.

Junker did however call for European officials to "put in place a more systematic defense strategy" to protect the 27-nation European Union (EU) from banking failures, rather than be satisfied "with case by case reactions."

He said the subject would be discussed Saturday in Paris during a meeting of representatives from Britain, France, Germany and Italy along with European Commission president Jose Manuel Barroso, Juncker himself, and Jean-Claude Trichet, president of the European Central Bank.

Proposals to set up an EU safety net to back banks has become a subject of pointed debate, particularly between Berlin and Paris.

German rejected on Wednesday a suggestion said to have come from France to raise 300 billion euros (420 billion dollars) to help out the financial sector.

French officials have denied floating the idea, but French Economy Minister Christine Lagarde proposed Thursday in German newspapers to create a "European fund" aimed at providing support for distressed banks.