European banks need about 100 bln euros: Austria

"Thank God it is not quite as high as bandied about in the media. It's about 100 billion (euros) that is needed for recapitalization," she told an investor conference.

EU and banking sources told Reuters earlier on Thursday that this was roughly the figure EU member countries had agreed was needed.

Fekter said European leaders meeting this weekend must come up with a package of measures about how to handle Greece's debt problems, add leverage to the euro zone's EFSF bailout fund and shore up banks' balance sheets.

She again spoke in favor of a model that would give the European Financial Stability Facility more firepower by letting it insure against initial losses on some countries' bonds.

Fekter thought there was not majority support among the 17 euro zone members for making the EFSF a bank. "Everyone has pretty much discarded this and said that is not appropriate for a quasi-state institution," she said.

"We will certainly have to discuss Greece regarding payment of the (next loan) tranche, or else we don't pay and then the EFSF manages Greece in terms of what Greece needs. That is what I would prefer because that is why it was created."

Addressing whether Greece would get a next tranche of aid, she said: "It depends a bit on the efforts in Greece. And one looks at what they are doing at the moment -- general strikes etc, then it is difficult for them to pull themselves out of this.

She said letting Greece go bust was a worst-case scenario that would create financial uproar and could trigger a domino effect as seen after Wall Street firm Lehman Brothers collapsed in 2008.

"Because of this we are intensively striving to prevent such a scenario but at the same time we have told the banks -- prepare yourself -- so that they can be stable enough, in case such a raw wind sweeps through."

($1 = 0.725 Euros)

(Reporting by Michael Shields and Sylvia Westall; editing by Anna Willard)