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Chancellor Reveals Biggest Ever Bank Bail Out

Wed, 04 Nov 2009

Alistair Darling has announced the biggest bank bail-out in history with the news that another £25.5 billion is to be poured into the Royal Bank of Scotland (RBS). RBS has now received £53.5 billion of taxpayer money following the £20 billion nationalisation last year, while another £8 billion was set aside yesterday to safeguard against similar troubles in the future. The government now has an exposure of more than £250 billion to RBS, having underwritten a large number of its toxic assets. Government ownership of the bank now stands at 84 per cent.

When the financial assistance given to other banks is included, the government has now provided the banks with £74 billion of taxpayers' money since the start of the financial crisis. According to the Conservatives, that figure equates to a tax liability of £4,350 for each of the 17 million families in the country.

It is hoped that the new financial assistance will kickstart lending to homeowners and businesses, who have yet to see banks reflect the assistance given to them in the interest rates being offered on savings accounts, loans and other forms of credit .
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