EU delays debt crisis summit to October 23

(BRUSSELS) - The European Union is delaying a summit by almost a week to October 23 to give leaders more time to polish their response to the eurozone debt crisis, the EU's president said on Monday.

The summit was originally scheduled to take place over two days in Brussels on October 17-18, but the eurozone has yet to implement a Greek rescue package agreed in July and officials are now working on plans to shore up banks.

EU president Herman Van Rompuy said he decided to push back the much-awaited talks after consultations over the past week with European Commission president Jose Manuel Barroso and the head of the group of eurozone finance ministers, Luxembourg Prime Minister Jean-Claude Juncker.

"This timing will allow to finalise our comprehensive strategy on the euro area sovereign debt crisis covering a number of interrelated issues," Van Rompuy said in a statement.

"Further elements are needed to address the situation in Greece, the bank recapitalisation and the enhanced efficiency of stabilisation tools," he said.

EU and eurozone finance ministers will schedule a preparatory meeting ahead of the summit, Van Rompuy said.

"These elements are closely related to the outcome of the troika mission to Greece on the state of implementation of the programme and to the Commission's plans for a framework for the bank recapitalisations, taking into account the work of the European Banking Authority," he said.

The EU president was referring to the troika of international auditors, the European Commission, the European Central Bank and the IMF, who are in Athens to ensure Greece implements austerity measures required in exchange for the next installment of a 110-billion-euro bailout that was agreed last year.

Eurozone leaders agreed in July to provide Greece a second bailout and expand the powers of their rescue fund, the European Financial Stability Facility (EFSF), in order to ring-fence the 17-nation single currency from future shocks.

The Greek rescue package has yet to be implemented, with parliaments in Malta and Slovakia the last holdouts in ratifying the deal, and Athens is now hoping to secure a bigger debt write-down from banks.

Under the July 21 agreement, eurozone governments will provide 109 billion euros in new bailout loans while the private sector agreed to take a 21-percent cut on their holdings of Greek government bonds maturing up to 2020.

Greek Finance Minister Evangelos Venizelos said Monday Athens was holding out for improved debt rollover terms from private creditors as he concluded key talks with the EU and the IMF auditors.

After bailouts of Greece, Ireland and Portugal, the debt crisis claimed its first bank on Monday when France, Belgium and Luxembourg decided to dismantle Franco-Belgian lender Dexia.

With concerns growing about the health of the entire banking sectors, French President Nicolas Sarkozy and German Chancellor Angela Merkel vowed a response within weeks and insisted they were united on plans to shore up lenders.

Without announcing concrete details, Sarkozy promised, after talks with Merkel in Berlin on Sunday, "lasting, global and quick responses before the end of the month."