Euro zone banks can absorb losses from crisis: Lagarde

FRANKFURT (Reuters) - Euro zone financial stability risks are on the rise due to a surge in debt levels but the bank sector has ample buffers to absorb losses while continuing to lend, European Central Bank President Christine Lagarde said on Thursday.

She added that the ECB remained ready to ease policy further if needed especially since uncertainty about outcome of the pandemic could dampened the strength of the recovery.

"The euro area economy will continue to be supported by very accommodative monetary and fiscal policies along with an expected gradual resumption in global activity," she told the IMF's International Monetary and Financial Committee, repeating the bank's standing guidance.

"We continue to stand ready to adjust all of our instruments, as appropriate."

(Reporting by Balazs Koranyi; Editing by Alison Williams)

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