Rudd backs Aussie banks

The Federal Government will guarantee all deposits in banks, building societies, credit unions and Australian subsidiaries of foreign banks, Prime Minister Kevin Rudd has announced. However, the move does not indicate any current problem in Australian banks but gives Australian banks a level playing field with foreign institutions.

“I am not about to have them in a position where they are placed at a disadvantage by foreign governments’ actions which have artificially helped badly performing banks in those foreign countries,” said Rudd.
 
The plan also involves securing money that Australian banks borrow from foreign sources. Banks will pay an insurance premium for the cover.
 
With opposition leader Malcolm Turnbull in support of the guarantee, Rudd has bipartisan support for the bill, which will be introduced into Parliament shortly.