UK Bank Bailout Likely "on Monday"
The British Government may hand over bailout money as soon as tomorrow. The details of the £50 billion (US$100 bilion) plan are still not finalized, but emerging reports suggest that the government would assume controlling interest of HBOS and Royal Bank of Scotland.
The unprecedented move would make the government the biggest shareholder in the banks and government representatives could be installed on their boards, the Sunday Times and Sunday Telegraph newspapers reported.
The scale of the operation could lead to trading in the banks on the London stock market being suspended to allow traders to digest the news, the reports said.
The banks and the Treasury are working on announcements to be made before the markets open, according to BBC business editor Robert Peston.
He says the first banks to take up the recapitalisation are likely to be HBOS and Royal Bank of Scotland (RBS).
A key aspect of the announcements will be what the government requires the banks to do in return for the cash.
"What we're doing over the weekend is looking at specifics, how do we implement it," Alistair Darling, chancellor of the exchequer, told the BBC on Saturday.
A banking source told AFP that four banks -- RBS, HBOS, Lloyds TSB and Barclays -- will announce before markets open Monday that they are taking up the offer of the government's bailout package announced last Wednesday.
We'll be following this story on our Markets Channel.