German chancellor Angela Merkel seeks to reassure after govt talks collapse

German chancellor Angela Merkel has pledged to maintain stability after the Free Democratic Party pulled out of talks on forming a new government with her conservative bloc and the left-leaning Greens, raising the possibility of new elections.

Ms Merkel told reporters that the parties had been close to reaching a consensus on how to proceed with formal coalition talks but that the Free Democrats decided abruptly to pull out just before midnight on Sunday - a move she said she respected, but found "regrettable".