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Taxpayers face years of debt in bank salvage deal

Posted By admin On January 18, 2009 @ 8:01 am In Money Watch | Comments Disabled

 Katherine Griffiths, Mark Kleinman and Patrick Hennessy
London Telegraph [1]
Sunday, Jan 18, 2009

Taxpayers are poised to take on the “toxic” debts of High Street lenders in a new bank rescue deal which could cost taxpayers billions of pounds.

Under the “pay as you go” plan, details of which were still being hammered out on Saturday, the Government will create a new insurance scheme that would see liabilities of up to £200 billion potentially kept on the public books for years.

Taxpayers would not face an immediate upfront cost but could be hit with payments in future if banks’ assets fell below a certain level.

(Article continues below)

Taxpayers face years of debt in bank salvage deal 161008pptv2 [2]

The insurance scheme has won favour at the expense of alternative plans to create a “bad” bank under which the Government would have simply bought banks’ existing toxic debts.

The latest rescue plan comes amid growing concern that lenders are about to unveil losses for 2008 that will shock the market.

Full article here [1]

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URLs in this post:

[1] London Telegraph: http://www.telegraph.co.uk/finance/financetopics/recession/4280229/Taxpayers-face-years-of-debt-in-bank-salvage-deal.html

[2] Image: http://www.prisonplanet.tv/subscribe.html

[3] ‘Brown will bankrupt Britain’: Taxpayers face rises of ’5p in every pound’ to plug toxic debt black hole: http://www.prisonplanet.com/brown-will-bankrupt-britain-taxpayers-face-rises-of-5p-in-every-pound-to-plug-toxic-debt-black-hole.html

[4] Stiglitz: Bank Plan Makes Taxpayers Suckers: http://www.prisonplanet.com/stiglitz-bank-plan-makes-taxpayers-suckers.html

[5] Taxpayers set to hand over MORE cash to bail out Britain’s failing banks: http://www.prisonplanet.com/taxpayers-set-to-hand-over-more-cash-to-bail-out-britains-failing-banks.html

[6] £200bn to save banks from bad debt: http://www.prisonplanet.com/200bn-to-save-banks-from-bad-debt.html

[7] What Happens Now to Plan to Buy Toxic Bank Debt?: http://www.prisonplanet.com/what-happens-now-to-plan-to-buy-toxic-bank-debt.html

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