Brussels, 13/10/2009 (Agence Europe) - On Tuesday 13 October, the European Commission approved the extension of some of the credit guarantee and recapitalisation schemes put in place by UK authorities a year ago. The Commission took the view that the extension is in line with its communication on state aid to overcome the financial crisis.
In line with the initial state aid scheme approved by the Commission on 13 October 2008, the United Kingdom provides new capital to eligible banks and building societies, guarantees short- and medium-term debt to encourage inter-bank lending and offers liquidity to banks under strict conditions. Tuesday's decision relates to the time banks have to make use of the full range of state measures. The scheme, due initially to end on 9 April, has been extended until 31 December 2009. The Commission says that the conditions that apply limits its scope, and ensure that there is fair competition between financial institutions. All other aspects of the aid remain unchanged from the October 2008 notification. (C.D./transl.rt)