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The British government is to take over the majority of shares in two of the countries biggest lending institutions.
The Brown government looks set to take over control of both HBOS and RBS in the next few days. HBOS is the countries biggest lender, with RBS previously being second before a dramatic crash in share prices last week.
Brown hopes that this move will generate more confidence in the financial markets, with the state acting as a guarantor of loans which were otherwise under threat. The moves are part of the £50 billion bail-out package announced by the government last week.
RBS, which also owns high-street bank Natwest had over 2200 branches across the UK and HBOS owned more than 1000. In comparison failed bank Northern Rock only had just over 200.
“The difficulty at the moment is that we have to restore trust. The greatest asset of all, the one that has been missing in the last few weeks, is confidence itself.” said Brown.
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