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WORLD> America
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US considers taking stakes in banks
(chinadaily.com.cn)
Updated: 2008-10-09 11:55 In a troubling sign of the world credit crisis, the Unites States government is considering taking ownership stakes in some American commercial banks, in a desperate effort to restore confidence in its financial system, the New York Times reported on its website today. Department of Treasury officials say the US$700 billion bail plan, which the Congress approved and President George W Bush signed into law a week ago, will empower them to inject cash directly into banks. Such a move would quickly strengthen banks' balance sheets and persuade them to resume lending. In return, the Treasury Department will have the right to take ownership positions in the commercial lenders, the New York Times website report said. The American recapitalization plan, officials say, has emerged as one of the most favored new options being discussed in Washington and on Wall Street. The appeal is that it would directly address the worries that banks have about lending to each other, and unclog the seizure of the credit market. There is no shortage of ideas, ranging from the partial bank nationalization proposal to a guarantee by the US Federal government of all lending between banks, the website said. |
