Measures announced to rescue banks
November 8, 2008 by admin
Filed under News, News-Banking
The Prime Minister recently called a press conference where he not only announced a surprise 0.5% cut in interest rates a day ahead of the scheduled Monetary Policy Committee meeting, but also unveiled a package of measures aimed at rescuing the British banking system. It is thought that around £400 billion will have to be injected by the government to put the rescue plan into place, and this will come from the public purse - something that has resulted in mixed reactions from members of the public.
As part of the rescue plan many of the country’s major banks could end up being partly nationalised according to industry officials.
The extra capital will initially be made available to eight of the nation’s largest building societies and banks in exchange for partial nationalisation. The Prime Minister, Gordon Brown, said that the rescue package was “designed to put the British banking system on a sounder footing.”
Following the announcements made at the press conference one official said: “What Gordon Brown and central banks have done today should stave off economic Armageddon - but it’s probably too late to save us from months, or even years, of sluggish growth.”
Alistair Darling said: “What Gordon Brown and central banks have done today should stave off economic Armageddon - but it’s probably too late to save us from months, or even years, of sluggish growth.”
The banking industry has welcomed the package, and an official from HBOS said: “The government’s announcement represents a very real and serious intention on the part of the authorities, following consultation with the banking industry, to bring stability and certainty to the UK banking system.”
