Germany will guarantee bank deposits

Oct. 5, 2008 at 10:37 PM

BERLIN, Oct. 5 (UPI) -- German Chancellor Angela Merkel said Sunday her government will guarantee all private bank accounts in a move intended to reassure depositors.

The announcement came as German officials tried to revive a bailout proposal for a major lender, The Washington Post reported Sunday.

"We want to tell savers that their deposits are safe," Merkel said at a news conference one day after an emergency summit of European leaders.

Merkel met in Paris Saturday with French President Nicolas Sarkozy and prime ministers Gordon Brown of England and Silvio Berlusconi of Italy. The leaders said afterward they would act on their own to shore up failing financial institutions and banks rather than sign onto a formal continent-wide plan.

However, they said they were planning a global economic summit to examine whether overhauls are needed for the existing World War II-era international financial system.

The deposit guarantee announced Sunday came officials learned that the collapsed commercial property lender Hypo Real Estate was worse off than previously expected, officials said.

The German Finance Ministry announced a $69 billion bailout plan for Hypo that would have the government contribute $37 billion while private lenders made up the difference, the Post said.

Like Us on Facebook for more stories from UPI.com  
Latest Headlines
Top Stories
Shark bite confirmed off North Carolina shore
Small plane crash kills two near Dallas
Justice Department investigating airlines for alleged price fixing
Britain, Western Europe endure record heat wave
Kuwait orders NBC reconnaissance vehicles