European Banks

TOPWRAP 4-Germany insures savings amid bank rescue talks

European banks have been hit hard by the fallout from a crisis which began in the United States when the housing market collapsed and bad mortgage debts multiplied. In Berlin, the fate of German lender Hypo Real Estate (HRXG.DE: Quote, Profile, Research, Stock Buzz) hung on the outcome of a showdown in continuing talks between the government and banks over the bill for a bailout.

Banks and insurers withdrew their support for a government-led 35 billion euro ($48.50 billion) rescue deal after problems came to light at the Munich-based lender. German officials and bankers were at work to hammer out a new deal before markets open. HRE is relatively small when compared with other firms in Frankfurt's blue-chip DAX .GDAXI index, but its role as a lender for commercial property, infrastructure and government financing makes it a major financial player.

Belgium and Luxembourg, meanwhile, were seeking a buyer for what remained of bank and insurance group Fortis (FOR.AS: Quote, Profile, Research, Stock Buzz) (FOR.BR: Quote, Profile, Research, Stock Buzz) after the Dutch nationalized the rest. An industry source said BNP Paribas (BNPP.PA: Quote, Profile, Research, Stock Buzz) was negotiating for control. The bank had"