European Union officials are working on plans to boost bankcapital to contain the euro-region's debt crisis, the InternationalMonetary Fund said, as Moody's Investors Service warned ofdeteriorating public finances.

“There is no secret at all that European authorities and theEuropean Commission are all working together on a plan to bringmore official capital, more public-sector capital, into the bankingsector,” Antonio Borges, the IMF's European department head, saidtoday in Brussels. “We would recommend that it move to a Europeanapproach,” he said. “More should be done on a cross-borderbasis.”

European bank stocks climbed, with France's Credit Agricole SAand Dexia leading the 46-member Bloomberg Europe Banks andFinancial Services Index 2.6 percent higher. Credit Agricoleclimbed 9.4 percent to 5.14 euros of 12:50 p.m. in Paris trading,while Dexia was up 7.2 percent to 1.08 euros.