The pair met at the home village and final resting place of General Charles de Gaulle on Saturday, Oct. 11, one day before a Paris summit on the global credit crisis of the leaders of all 15 members of the euro zone.

France and Germany have "exactly the same view" on the financial crisis, Sarkozy told reporters.

"We have prepared a certain number of decisions that we will submit to our partners in the presence of the president of the European Commission and the governor of the (European) central bank," he said. "All decisions, all preparations and all analyses, we're making together."

Merkel agreed on the need for unity, and said governments would have to "redirect the markets so that they serve the people, and not ruin them."

She also said Paris and Berlin were "on the same path as regards putting in place a concerted and coherent reaction for the euro zone." The chancellor, however, added that there was also "naturally room for maneuver for each member state."

Both leaders also rejected establishing a common European fund to aid banks. Sarkozy said a pan-European pot would create "gigantic problems.

"This isn't about a European fund, but about balanced behavior by all member states," Merkel added.

Euro zone mulls following British lead

The heads of the European Union's four biggest economies -- Britain, France, Germany and Italy -- had held a first emergency summit one week earlier but Merkel and Sarkozy were split over the need for a common plan.

After a week of plunging stock markets, and crisis talks on Friday between the finance ministers of the G7 industrial powers, the euro zone has agreed to try once more to coordinate a response.

Sunday's meeting follows a move by Britain's Prime Minister Gordon Brown to guarantee inter-bank lending and to offer to take stakes in some of the country's biggest banks in a program of partial nationalization.

French Finance Minister Christine Lagarde said that while French banks were in a relatively good position and would probably not need a government buy-in, other European economies may benefit from following the British example.

"It's very likely, because European banks are also under-capitalized," she said in an interview with France Info radio on Saturday. "We have seen Great Britain, which is outside the euro zone, make propositions in this area. We'll have to see about that in the euro zone, but I suppose it's one of the options."

Germany on verge of new rescue plan

There is a better chance of leaders making a nationalization deal after Berlin, which has expressed its reluctance to governments taking stakes in private banks, was reportedly preparing a new bank rescue package that includes such an option.

Merkel said Germany may inject capital into its banks but it was not planning to take permanent stakes in them.

"This is about providing the banks with sufficient capital," Merkel told reporters. "I don't rule out that there will be capital injections."

German media reported that Merkel's Cabinet would meet to discuss the rescue package on Monday and work to push it through parliament in an expedited process.

The plan to be discussed at the euro-zone leaders' meeting includes a mix of state guarantees and the possibility of the government buying a stake in faltering banks and could cost a total of between 300 billion euros and 400 billion euros, Handelsblatt.com reported Saturday.

"I hope that the guarantees for inter-bank credit and a easing of accounting policies will be enough for German banks," Michael Meister, the Christian coalition's deputy parliamentary leader, told the Web site.

He added that if the government did shore up banks with new capital, it would "demand substantial services in return."

Earlier in the week, the German daily Die Welt also reported that Germany was working on a British-style plan.