German banks plan worth around 400 billion euros: lawmaker
BERLIN (Reuters) - A German rescue package for its banks will be worth around 400 billion euros ($549 billion) and be restricted until the end of 2009, a senior official in Chancellor Angela Merkel's conservatives said on Sunday.
"This whole law we have planned will expire again on December 31, 2009," Volker Kauder, parliamentary floor leader of Merkel's Christian Democrats (CDU), told state broadcaster ARD.
Kauder said the overall package would be worth "in the region of" 400 billion euros, confirming earlier reports. Part of the plan is set to include interbank guarantees, which Kauder said would likely be worth between 200-250 billion euros.
After meeting in Paris, leaders from the euro zone economies and Britain pledged on Sunday to pump public money into banks battered by the worst financial crisis since the 1930s.
German coalition sources said Berlin plans to provide equity capital worth up to 100 billion euros to help its banks cope with the fallout from the crisis.
"Banks which take advantage of this state help will have to reckon with massive changes though," Kauder added.
One such example of this would be restrictions imposed on executive pay, Kauder said.
German media said the cabinet planned to make a decision about the British-style package on Monday, and aimed to enact the measures as soon as possible via a fast-tracked law.
"The aim is for an orderly but quick legislative process aimed at averting risks for our economy," Finance Ministry spokesman Torsten Albig said on Sunday.
Following a meeting with French President Nicolas Sarkozy on Saturday, Merkel said Germany might inject capital into its banks but was not planning to take permanent stakes in them.
According to a document circulated at the Paris summit, two key things agreed by European leaders were the commitments to provide capital and insure or directly buy into new debt issues.
Sarkozy said governments were ready to take stakes in banks and that details would be announced at national level, to start with in Paris, Berlin and Rome, on Monday.
Britain's plan involved injecting 50 billion pounds ($86.42 billion) of taxpayers' money into its banks, and underwriting interbank lending which has all but frozen around the globe.
(Writing by Dave Graham)
