(RTTNews) - Germany and France unveiled aggressive banking rescue plans on Monday, a day after European leaders emerged from a meeting in Paris with a promise to offer a coordinated response to the credit crisis.

A nearly EUR500 billion German plan was confirmed by Chancellor Angela Merkel and is expected to receive legal approval by the end of the week.

According to the German finance ministry, the plan provides EUR80 billion in new capital and up to EUR400 billion in bank guarantees.

“Such unusual market conditions call for unusual measures”, said a statement from the finance ministry. “It is not just about protecting banks and other financial institutions but also about protecting citizens.”

Similar efforts were outlined by French President Nicolas Sarkozy on Monday. The French government pledged EUR340 billion to prop up the nation’s floundering banks. EUR40 billion will go toward bolstering France’s floundering banks. The government will also guarantee as much as EUR300 billion in loans between banks.

Earlier on Monday, the UK government has decided to buy majority stakes in Royal Bank of Scotland Group plc or RBS (RBS) and mortgage lender HBOS plc (HBOS.L), reports said Monday. The government will infuse GBP 20 billion into RBS, Britain’s fourth-biggest bank.

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Posted in Categories: Economy, Eurozone, Releases, UK.

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