OTTAWA (Reuters) - The U.S. plan to cleanse toxic assets from bank balance sheets is an important step toward global recovery, but similar plans are also needed in Europe, Canadian Finance Minister Jim Flaherty said on Tuesday.

"The most important thing that had to happen internationally, and in the U.S., is to fix the banks," Flaherty told CTV television.

"The provision of details by U.S. Treasury Secretary Timothy Geithner and President Obama ... is very important moving forward. More needs to be done in Europe," he said.

Washington announced details on Monday of its plan to offer a series of incentives for private investors to help rid banks of up to $1 trillion in bad assets. The U.S. Treasury will launch the program with $75 to $100 billion from existing funds for rescuing the financialy industry.

Flaherty, who oversees a domestic banking system that is more solid than in other major economies but distressed nonetheless, has focused in recent weeks on the need for the United States and Europe to fix their banking systems. At the last meeting of G20 finance ministers in Britain, he expressed frustration at the slow pace of progress on the issue. (Reporting by Louise Egan, Editing by Chizu Nomiyama)