Fed offers AIG fresh $37.8bn injection
The move, which comes on top of the $85bn rescue loan that gave the government control of the company last month, is designed to help AIG fund its troubled securities lending operations.
U.S. May Take Ownership Stake in Banks
Treasury officials say the just-passed $700 billion bailout bill gives them the authority to inject cash directly into banks that request it. Such a move would quickly strengthen banks’ balance sheets and, officials hope, persuade them to resume lending. In return, the law gives the Treasury the right to take ownership positions in banks, including healthy ones.
Henry Paulson warns that more banks could collapse
Henry Paulson sounded a warning that “even with the new Treasury authorities, some financial institutions will failâ€. The rescue scheme “doesn’t exist to save every financial institution for its own sakeâ€, he added.
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Iceland suspends trading after bank seizures
Iceland’s stock exchange on Thursday suspended trading in all shares citing unusual market conditions after the country’s largest lender, Kaupthing Bank, followed domestic peers into state ownership.
S. Korea, Hong Kong, Taiwan Cut Rates, Joining Action
The Bank of Korea and Taiwan’s central bank lowered their rates by a quarter of a percentage point and Hong Kong cut its benchmark to 2 percent. The Bank of Japan, which kept its policy rate at 0.5 percent this week, pumped 2 trillion yen ($20 billion) into the financial system.
Ireland extends deposit guarantee to foreign banks
Brian Lenihan, the Finance Minister, said he would extend the controversial €400 billion (£316 billion) guarantee scheme to foreign-owned banks with significant operations in Ireland
