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October 8, 2008

Britain unveils $84B bank rescue plan

British Finance Minister Alistair Darling on Wednesday announced a £50 billion ($87.4 billion) rescue package for UK banks.

The plan will inject money into the banking system to provide immediate relief and free up lending, a Treasury statement said. The government will give the largest banks £25 billion ($43.7 billion) with another £25 billion available if desired.

The government will also guarantee the lending that banks make to each other, the Treasury said.

Darling made his announcement shortly before markets opened in Britain. London's FTSE 100 opened down 2.5 percent.

The chancellor said it was important for the British government to "send a clear message" that it can step in and help the financial industry amid the global economic crisis.

"We will stabilize the position, we'll help banks restructure so they can rebuild their strength, and also do everything we can -- whatever it takes -- to ensure that we get that stability and we try and steer our way through what is a pretty turbulent period," Darling told CNN affiliate ITN. Source

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