12 Oct 2008

Report British govt to launch its biggest retail bank rescue

4:39 pm on 12 October 2008

The Sunday Times newspaper in Britain is reporting the British government will launch its biggest retail bank rescue on Monday.

The paper says the four largest banks, HBOS, Royal Bank of Scotland, Lloyds TSB and Barclays will ask for a combined Stg35 billion lifeline.

The unprecedented move would make the government the biggest shareholder in at least two banks, HBOS and Royal Bank of Scotland, the Sunday Times said on its website. It did not give a named source for its information.

No government officials or representatives from the four banks were immediately available to comment on the report.

British Finance Minister Alistair Darling, attending a G7 finance ministers' meeting in Washington, said on Saturday the government was to give more details early this week about its already announced Stg400 billion banking rescue plan.

The Sunday Times said the scale of the fund-raising could lead to trading at the London Stock Exchange being suspended to give the market time to digest the impact.