French President Francois Hollande called on Thursday for the euro zone to adopt bold new mechanisms to insulate member states and their banks from market turmoil, such as a joint fund to pay down debt, putting him on a collision course with Berlin.

After a meeting with Italian Prime Minister Mario Monti in Rome, Hollande said he would urge EU leaders at an end-June summit to adopt a series of measures to strengthen economic
growth and financial stability in the euro zone and deepen economic integration.

Hollande said he had submitted details of his proposals to European Council President Herman Van Rompuy.

"We need imagination and creativity to find new financial instruments," Hollande told a joint news conference with Monti.

"To deepen financial union, there are many options such as a financial transactions tax and joint debt issuance, including euro bonds, euro bills or a debt redemption fund," he said. 

- Reuters