President Unveils New Bank Bailout Plan Worth $250 Billion

The Bush administration early this week unveiled a plan to inject $250 billion into troubled U.S. banks to help beat the credit crisis, MSNBC reports. The program calls for the government to buy preferred shares in qualifying financial institutions, with stakes in each institution limited to $25 billion or 3% of risk-weighted assets. It set a Nov. 14 deadline for banks to apply for government purchases.

Treasury Secretary Henry Paulson said nine banks described as “healthy institutions” had agreed to accept government stakes for the good of the economy.

“Today’s actions are what we must do to restore confidence in our financial system,” Paulson said. “We regret having to take these actions,” he said. “Today’s actions are not what we ever wanted to do — but today’s actions are what we must do to restore confidence to our financial system.”❖