BERLIN, October 13, 2008 (AFP) – Germany was to unveil Monday a 470-billion-euro rescue package to save the country’s banks from collapse, government sources said, after European leaders hammered out a common approach at a high-stakes weekend summit.
Government sources in Europe’s biggest economy said that the package would include around 70 billion euros (95 billion dollars) in fresh capital for stricken banks and some 400 billion euros (545 billion dollars) in guarantees for interbank lending.
The measures, in line with others being prepared by other European governments following Sunday’s emergency summit in Paris, were to be discussed by the cabinet from 1:00 pm (1100 GMT) before they are outlined by Chancellor Angela Merkel at 3:00 pm (1330 GMT), the government said.
Finance Minister Peer Steinbrueck was then scheduled to give more details at 3:30 pm (1330 GMT).
In return for the capital injection the German state is expected to take stakes in the banks in a partial nationalisation similar to plans announced in Britain, which other eurozone countries also plan to copy.
Last week Berlin put together a 50-billion-euro rescue of Hypo Real Estate, the country’s fourth biggest bank, but this took the form of guaranteeing badly