EU finance ministers emerged from talks with a set of seven “common principles” to guide them through the current turmoil. They include “timely” and “temporary” interventions bringing new management to ailing financial institutions and steps to protect the interests of both taxpayers and fair competition.

“Europe is determined to act in a coordinated manner in the face of this crisis,” Lagarde said after chairing a one-day meeting of EU finance ministers.

European Union governments have avoided copying the U.S. with a massive bailout to buy up bad debt from banks and help unfreeze lending. The EU is hampered in taking unified action because while it boasts a single currency in 15 of its 27 member states nations — it has no legal powers to intervene in financial markets.

Instead, European national governments have pumped billions of euros (dollars) into ailing banks and organized takeovers or even nationalizations or struggling lenders.

In their statement, EU finance ministers committed “to take all necessary measures to enhance the soundness and stability of our banking system and to protect the deposits of individual savers.”

Ireland started the ball rolling last week, promising a euro400-billion guarantee for all deposits in six Irish banks in an effort to stave off the collapse — and expensive government rescue — of lenders that overstretched themselves on property loans. Irish Finance Minister Brian Lenihan defended that Tuesday saying, “We must restore confidence to the European banking sector (but) there is not enough liquidity in the market. That’s a problem we have to address,” he said.

Germany, Britain and others have complained that Ireland’s unilateral move broke EU level playing field rules by giving Irish banks an edge over competitors that would unfairly attract savers.

By allowing all EU nations to raise their savings deposit coverage to euro100,000 that level playing field has been restored, said Dutch Finance Minister Wouter Bos. He said the Netherlands would raise its coverage to euro100,000.

“This is a signal of confidence” in financial institutions, he told reporters. “It shows a united Europe.”

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