UK and other European officials on Sunday expressed surprise at Germany’s abrupt move to guarantee German private bank accounts, amid concerns other European governments would have to follow Berlin’s lead and offer similar safeguards to savers, to avoid a cross-border flight of capital to more secure banks. One UK official said there was annoyance that German chancellor Angela Merkel had acted unilaterally only hours after attending an economic summit in Paris at which she agreed there should be greater cross-border co-ordination of measures during the economic crisis. The Danish government early on Monday guaranteed all bank deposits in Denmark as part of a deal with banks to set up a Dkr35bn ($6.5bn) liquidation fund. At the summit, leaders from France, Germany, Italy and the UK agreed not to let any large financial institution in their country fail, said people familiar with the talks. German officials said the move was agreed because of fear that the crisis at Hypo Real Estate would lead to widespread panic on Monday.
