German chancellor Angela Merkel on Sunday snubbed Eurobonds as a short-term answer to Europe's sovereign debt crisis while four of Greece's largest banks in Athens stepped in to rescue a smaller lender.

Merkel continued to oppose a bond guaranteed by all of Europe's member states, saying the eurozone would turn into an inflation community if nations sold a joint bond without amalgamating their economic policies first.

Investors faced an anxious start to the week as banks in Greece tried to avert on Sunday a run on its frail banking system by taking up €50m convertible bonds to bail out Proton bank, the Central Bank said.

Proton Bank, which has an estimated market value of €20.7m and a network of 31 branches, was kept afloat at the weekend by the National Bank of Greece, Piraeus Bank, EFG Eurobank and Alpha bank.