Russia considers banking bailout plan

MOSCOW, June 26 (UPI) -- Fearing bad loans could seriously jeopardize its economy, Russia is reported considering a banking bailout plan, government officials say.

The proposal would go beyond the emergency action of the United States, analysts told The Financial Times.

Deputy Prime Minister Igor Shuvalov called a meeting of financial experts Friday in Moscow to consider taking stakes in troubled banks and recapitalize the country's banking system, the Times said.

One of several plans under consideration would see the issue of treasury bills to boost the balance sheets of Russia's 55 biggest banks (those with a minimum of $1.6 billion in assets), the Times reported. In return, the state would get preferred shares.

Unlike the U.S. bank bailout, the Russian plan would see the government take board seats and have veto rights.

Analysts said such a plan would allow banks to declare the true level of bad loans and enable them to start lending again in 2010.