Wednesday, Nov 02, 2011
(This story was originally published Tuesday)
RIYADH (Zawya Dow Jones)--Saudi Arabia's central bank governor Tuesday said he is confident that European leaders will resolve the region's sovereign debt crisis, despite market turmoil sparked by the Greek government's call for a referendum on the country's bailout package.
"I'm worried to a certain extent but less worried than I was a week ago," Muhammad al-Jasser, governor of the Saudi Arabian Monetary Agency, told Dubai-based Al Arabiya channel.
"I think now, for good reasons, that leaders in Europe will stop the crisis and restore confidence in the market," he said, adding that the crisis proves that monetary and fiscal policies should be linked.
The central bank governor added that banking in the kingdom is the safest in the world and that the country's lenders won't change their solvency or provisions policies.
Al-Jasser's remarks come just days after European leaders in Brussels agreed on a set of measures to reduce Greece's debt burden and beef up the firepower of a rescue fund to make sure the continent is capable of supporting other troubled euro-zone nations. As part of the plan, the European leaders also agreed to reinforce their banks by requesting they add to their capital reserves.
But Greek Prime Minister George Papandreou late Monday announced a surprise referendum on the country's European Union bailout deal, prompting markets to plunge Tuesday.
-By Summer Said, Dow Jones Newswires; +966-546-842373; summer.said@dowjones.com
(END) Dow Jones Newswires
02-11-11 0400GMT
