The government is to inject £37 billion into the UK’s failing banking sector.
The money will go to Royal Bank of Scotland (RBS), Lloyds TSB and HBOS to help them recover, having been hit hard by the credit crunch.
Chancellor Alistair Darling said the government is "determined to do everything we can to stabilise our banking system and make it stronger".
In return he expects "restrictions on what happens in boardroom pay" and "guarantees in relation to increased lending to businesses, as well as to mortgages too".
RBS will be given the largest share (£20 billion) with the government taking a controlling share in its operation. Lloyds TSB is to receive £17 billion.
Both RBS and Lloyds have agreed to not pay dividends this year and will now have government ministers on their boards.
However, the chancellor has insisted they "aren’t going to get involved in the day-to-day running" of the banks.Share: