(BRUSSELS) - y, who is struggling to keep down France's deficit, said the leaders had agreed that the rles "should reflect the exceptional circumstances that we find ourselves in."

But Luxembourg premier Jean-Claude Juncker, the chairman of eurozone finance ministers, insisted the leaders had agreed that the rules and their deficit limits had to be respected in their "entirety" despite the financial crisis.

Even before the current crisis, finance ministers have often clashed over the public finance rules, with Germany defending the cause of strict fiscal discipline and France seeking more wiggle room.

Ireland will likely face a grilling by fellow EU ministers over its decision last week to offer an unlimited guarantee on all deposits in its biggest banks.

The move has stirred anger especially in Britain and Germany, which fear their depositors will rush to open up banking accounts in Ireland.

German Chancellor Angela Merkel told journalists in Paris on Saturday that she was "not satisfied" with Ireland's decision, which she said went against EU competition rules.

"It is important to act in a balanced way, and for countries not to cause harm to each other," she said.

Since the start of the turmoil in August 2007, EU finance ministers have done little more than draw up a road-map to strengthen the stability of Europe's financial system.

With a growing number of European banks pushed to the brink of collapse over the last week, a new sense of urgency has emerged here as leaders realise the crisis is not just a US problem.

But while the United States has chosen the path of a hugely ambitious and equally costly sector-wide bailout, Europe has decided it will be up to national authorities in each country to save their own banks.

While that approach may be well suited for banks with no foreign operations, finance ministers could find themselves put to the test if a big European bank with cross-border activities were to run into trouble.

Dutch, Belgian and Luxembourg authorities proved they could rise to the challenge over the last week when Fortis hit the rocks, but that may not always be the case if a bigger bank were to flounder.

The EU finance ministers are also due to consider recommendations to tighten executive pay rules, with plans to limit so-called golden parachute bonuses which some corporate fat cats have received even when they stood down in disgrace.

Sarkozy said in Paris that bonus structures for top executives should be "revisited in order to avoid incentivising the taking of excessive risk and to fight against what we can call 'short-termism.'"

The ministers' talks will be essential for forging a common European approach to the crisis ahead of a meeting at the end of the week of finance ministers from the Group of Seven most powerful countries in Washington.

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