The International Monetary Fund has urged European banks to raise capital to spare the world’s economy from further crisis. European banks face about US $409 Billion (about 300 Billion euros) in potential losses from the euro-zone debt crisis, The Wall Street Journal reported Thursday. The fund said fiscal strains emanating from weaker euro zone members have had a direct impact of about 200 billion euros on banks in the European Union since its debt crisis started last year. In addition to the holdings of government debt, lower bank asset prices raised credit risks between banks for an overall hit of 300 billion euros. The IMF cautioned that the figure – based on recent market measures – doesn’t necessarily represent the size of a capital hole at European banks, saying such an assessment would require a closer examination of bank balance sheets. But in a report ahead of its annual meeting, it used the calculation to stress the importance of increasing bank capital buffers. The IMF said the global credit crisis “has moved into a new, more political phase” as governments struggle to get their finances in order and larger European nations debate how to rescue their neighbors. The latest turmoil in the euro zone, the US debt-rating downgrade and capital shortfalls at banks have renewed threats to financial stability around the world as global growth slows, the fund said.