NEW YORK, September 18, 2008 (AFP) – The US Federal Reserve on Thursday threw 180 billion dollars into a global fight against the financial crisis as Wall Street legend Morgan Stanley became the latest name under attack and Britain’s top mortgage lender was forced into a merger. China’s sovereign wealth fund, China Investment Corporation, already owns 9.9 percent of Morgan Stanley.
The New York Times said Morgan Stanley was in “preliminary” talks with Wachovia Corporation on a merger.
US thrift Washington Mutual is also at the centre of market worries which have dragged down stocks.
In Britain, authorities rushed to douse their firestorm over Halifax Bank of Scotland (HBOS), the country’s biggest mortgage lender, which was taken over by retail bank Lloyds TSB in an all-share deal worth 12.2-billion-pounds (15.4 billion euros, 21 billion dollars).
The bailout came after HBOS stocks plummeted in wild trading this week.
Britain’s Financial Services Authority (FSA) was forced to issue a statement on Wednesday saying HBOS was well-funded, in an attempt to avoid a flood of savers trying to withdraw money.
It said the takeover would “enhance stability within financial markets and improve confidence among customers and investors”.
Amid an internation