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German u-turn on bank bailout

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German u-turn on bank bailout

 German u-turn on bank bailout
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Germany has bitten the bullet and accepted that it must extend a helping hand to its struggling banks. Sources inside the government say ministers are preparing a 400 billion euro programme of guarantees, as well as some 70 billion to recapitalise those banks in distress.

It is something of a u-turn for Chancellor Merkel, who had been insisting she could not and would not simply throw public money at the problem.

Germany has long been the driving force behind the European economy, and ministers finally accepted that not joining other EU governments’ moves to free-up the system could prove disastrous.