France and the European Central Bank do not want to restructure Greek debt further, fearing market contagion and, for Paris, additional pressure on French banks that hold significant amounts of Greek, Spanish and Italian debt. A major recapitalization of French banks would put more strain on France’s budget and require new cuts elsewhere to meet deficit targets, and could thus jeopardize France’s coveted AAA credit rating. That would be bad politics with elections six months away and Mr. Sarkozy already unpopular.

There is also a fear that banks would cut back on lending rather than try to raise more capital while their stock prices are down, which could lead to a new credit crunch at a time when the entire euro zone is on the brink of a new recession.

France wants Europe to collaborate on recapitalizing banks, ideally by turning the bailout fund into a bank, which could then draw on loans from the European Central Bank, which has the authority to print euros as needed.

But Germany and the central bank itself have resisted that option. “The path is closed for using the E.C.B. to ease liquidity problems,” Mrs. Merkel told her parliamentary caucus in Berlin on Friday, Reuters reported.

Mrs. Merkel wants each country to be responsible for injecting funds into its own banks, and only then turn to the regional bailout fund in an emergency. Politically, it is easier for her to explain to Germans that German money is being used to recapitalize German banks than to concede that it is going to everybody’s banks. Mrs. Merkel is also compelled by German law to seek a mandate from Parliament’s budget committee before committing new funds. Mr. Sarkozy does not face such restrictions.

Still, some progress has been made on the amount of new funds needed to shore up banks. Partly that is because the Europeans have decided that the amount required is half of what the International Monetary Fund and some other experts have suggested. And partly because European officials have used new ways of valuing sovereign debt that offset markdowns on the bonds of weaker countries with paper gains on sovereign holdings of less indebted countries.

Even so, France is asking for a period of nine months for banks to meet recapitalization targets.

France and Germany also disagree on how to leverage or maximize the $590 billion bailout fund to create a “wall of money” to discourage the markets from speculating further on Spain and Italy. The fund has already committed about $200 billion to Greece, Portugal and Ireland, and the German government has promised taxpayers that its own share, as the largest contributor, will not be more than $305 billion.