The government has announced a second package of measures to support the banking system.
The long list of measures includes a scheme to offer insurance against banks losing more money from the toxic debt that started the credit crunch.
The banks will have to pay for the insurance, but the government says it does not expect to be paid in shares.
Prime Minister Gordon Brown condemned the banks that had made losses from "irresponsible" lending.
Risky assets
Under the insurance scheme, banks will agree with the government the amount they expect to lose from particular debt.
The Treasury will then sell insurance against about 90% of the institutions' additional losses from the debt. The government has announced a second package of measures to support the banking system.
The long list of measures includes a scheme to offer insurance against banks losing more money from the toxic debt that started the credit crunch.
The banks will have to pay for the insurance, but the government says it does not expect to be paid in shares.
Prime Minister Gordon Brown condemned the banks that had made losses from "irresponsible" lending.
Risky assets
Under the insurance scheme, banks will agree with the government the amount they expect to lose from particular debt.
The Treasury will then sell insurance against about 90% of the institutions' additional losses from the debt. The government has announced a second package of measures to support the banking system.
The long list of measures includes a scheme to offer insurance against banks losing more money from the toxic debt that started the credit crunch.
The banks will have to pay for the insurance, but the government says it does not expect to be paid in shares.
Prime Minister Gordon Brown condemned the banks that had made losses from "irresponsible" lending.
Risky assets
Under the insurance scheme, banks will agree with the government the amount they expect to lose from particular debt.
The Treasury will then sell insurance against about 90% of the institutions' additional losses from the debt.
The government describes the assets involved as being those "most affected by the current economic conditions".
Most of the debt involved is very difficult to value because the market in it has collapsed.
The questionable value of the assets has meant that banks do not know how much money they are in a position to lend.
The government hopes that by insuring them against additional losses, it will encourage the banks to resume normal lending to businesses and individuals.
Chancellor Alistair Darling told the BBC that banks taking out the insurance would have to make "very specific legally binding agreements to lend more money".
Previous rescues
There have also been changes to the terms of previous bank rescues.
Northern Rock has said that it is to be given longer to repay its loans from the government.
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