Is Australian Government guaranteeing all banks?

The Australian government is taking steps to help stabilize the country's economy. Over the weekend Prime Minister Kevin Rudd announced plans for the government to guarantee bank deposits for the next three years.



STORY:
In a bid to combat the global financial turmoil, Australian Prime Minister Kevin Rudd announced that deposits are safe.

[Kevin Rudd, Australian Prime Minister]:
"The Australian government will guarantee all deposits, whatever their size, in all Australian banking institutions for three years. Banks, building societies, credit unions. As Prime Minister of Australia again I am not prepared to stand idly by in dealing with the concerns of Australians as they watch global financial developments unfold."

The Australian government has allocated a 2.6 billion U.S dollar fund to help maintain liquidity in the markets.

Rudd stressed that banks are well regulated, but action is needed.

[Kevin Rudd, Australian Prime Minister]:
"This global financial crisis has entered a new and dangerous phase with real consequences for growth, for jobs and therefore for the future and as a consequence the government of course is examining measures for the future about how best to deploy a surplus that we had set aside for the future."

Ireland and Germany have also said they will guarantee the funds of depositors while in the UK it's reported that Britain's ailing banks are to ask the government for a 35 billion pound cash injection.
The Sunday Times newspaper says HBOS, Royal Bank of Scotland, Lloyds TSB and Barclays, are behind the move.

The announcements come as the world's leading finance ministers meet to discuss the credit crisis.

The leaders have agreed to work together to improve the economic climate by improving regulation and the overall function of the world markets.