E.U. Details $957 Billion Rescue Package
LANDON THOMAS Jr.
Published: May 10, 2010
BRUSSELS — European leaders agreed early Monday to provide a huge rescue package of nearly $1
trillion to combat the debt crisis that has engulfed Europe, and global markets responded by reversing the
steep declines of recent days.
In an extraordinary session that lasted into the early morning hours, finance ministers from the European
Union agreed on a deal that would provide $560 billion in new loans and $76 billion under an existing
lending program. Elena Salgado, the Spanish finance minister, who announced the deal, also said the
International Monetary Fund was prepared to give up to $321 billion separately.
Officials were hoping the size of the program — a total of $957 billion — would signal a “shock and
awe” commitment in the same vein as the $700 billion package the United States government provided to
help its own ailing financial institutions in 2008.
And the initial reaction was definitely positive. The euro jumped back above the $1.30 mark for the first
time in a week, to $1.3014 from $1.2757 late Friday.
The yield on Greek 10-year benchmark bonds, which had soared to record levels as investors became
increasingly afraid of default, fell an astonishing 5.9 percentage points to 6.6 percent.
In early trading, the Euro Stoxx 50 index, a barometer of euro zone blue chips, rose more than 7 percent,
while the FTSE 100 index in London rose 3.5 percent.
European banks were the early winners. In France, BNP Paribas soared 14 percent and Credit Agricole
rose 16 percent; Germany’s largest bank, Deutsche Bank, gained 10 percent.
Trading in U.S. equity index futures suggested stocks would open sharply higher on Wall Street.
In Tokyo, the benchmark Nikkei 225 stock average closed with a gain of 1.6 percent, while the Sydney
market barometer S&P/ASX 200 rose 2.7 percent. Hong Kong stocks were also higher, with the Hang
Seng index up 2.4 percent in late trading. The Shanghai composite index added 0.4 percent.
The package was much larger than expected, and represented an audacious step for a bloc that had been
criticized for acting tentatively, and without unity, in the face of a mounting crisis.
Underscoring the urgency of the situation, President Obama spoke to the German chancellor, Angela