Bos wants to extend bank guarantee scheme

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Dutch Finance Minister Wouter Bos wants to extend the bank guarantee scheme as he feels recovery remains fragile.

The Hague – Dutch Finance Minister Wouter Bos wants to extend the guarantee scheme designed to ensure banks keep lending each other money until June 2010.

In 2008, the Netherlands guaranteed EUR 200 billion in loans between banks to help ease the financial crisis. The government guaranteed a part of the loans between banks and between financial institutions and banks to restore public confidence.

Since then, Dutch banks have requested guarantees of EUR 52 billion in all.

In a letter to the lower house, Bos said that while the situation on the capital markets is improving, the recovery remains fragile.

The extension of the guarantee scheme will first have to be approved by the lower house and the European Commission.

Under the extension scheme, the premium charged to banks will rise from January 2010 to discourage banks from profiting from the scheme.

Radio Netherlands / Expatica

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