On Sunday European leaders endorsed a broad framework for re-capitalizing banks by between 100 and 110 billion euros ($139-152 billion) to cope with likely losses on Greek and other euro zone sovereign bonds.

But a final decision on that and other key issues was put off until a second summit on Wednesday.

Analysts warned a bank plan would be worthless without a wider debt crisis solution.

“Even if we’d got 200 billion euros in or 300 billion euros, the recapitalization is just part of a bigger picture. Unless the market becomes convinced that there’s a mechanism to support Italy even a multiple of this capital wouldn’t be enough to bring reassurance,” said Jon Peace, bank analyst at Nomura.

“It’s all eyes on Wednesday and how credible is the EFSF (rescue fund) plan? There are still a lot of questions to be answered, so there’s a real danger the market is underwhelmed by what emerges on Wednesday.”

By 0950 GMT the STOXX 600 European bank index was up 1.1 percent at 138 points, outperforming a 0.4 percent rise by the broader pan-European index.

A breakdown of how much individual banks need is due to be released on Wednesday.

The bulk of the capital is likely to be needed by banks in Greece, Spain and Portugal.

France’s Societe Generale and BNP Paribas , Germany’s Deutsche Bank and Commerzbank and Italy’s UniCredit could each need several billion euros, according to estimates by Reuters and analysts, but each is likely to be able to raise that privately.

Shares in Societe Generale, Deutsche Bank and Commerzbank added 1.5-2 percent and BNP Paribas and UniCredit gained about 0.5 percent.

Greek bank shares plunged however, down 13 percent on fears that a deeper markdown on Greek government bonds held by the private sector would force lenders to be part-nationalized. Greece’s banks could need over 30 billion euros.

Banks and EU leaders remain far apart on the scale of the loss private sector investors should take on Greek bond holdings, a key part of the EU talks about Greece’s debt burden.

Banks have offered to stretch the voluntary loss on Greek debt to 40 percent, from July’s agreement to take a 21 percent loss, but politicians are demanding the private sector agree to writedowns of at least 50 percent, a senior German banker said on Sunday.

Only losses of 50-60 percent would make Greece’s debt sustainable in the long term, a study said.

Talks among the private sector and officials are continuing in Brussels. Industry sources said banks are willing to take a bigger loss, but fear that too big a “haircut” will set a dangerous precedent, particularly for Italian bonds.

More positive is the prospect of EU guarantee schemes to back up banks and make it easier for them to access funding.

Second tier banks and those in troubled euro zone countries have struggled to borrow or raise funds in debt markets.

Under the recapitalization plan, the European Banking Authority will tell banks to hold core capital of 9 percent of risk-weighted assets after marking sovereign bonds to market prices.

Banks are expected to be given 6-9 months to raise money, first from their earnings or private investors, then by getting national bailouts or as a last resort from the EFSF.

The estimate for recapitalization includes 46 billion euros already earmarked for bank support in the EU/IMF bailouts for Ireland, Greece and Portugal, however, according to EU sources, some of which has already been taken by banks.