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Financial Crisis Hits More US, European Banks


The United States and several European countries are trying to prevent fallout from the global financial crisis from toppling more high-profile banks.

U.S. officials Monday helped arrange the takeover of one of the country's largest banks, saying its failure would have "serious, adverse effects" on the economy.

The Federal Deposit Insurance Corporation says Wachovia Corporation has taken substantial losses on $312 billion in loans. Under the FDIC-brokered deal, U.S.-based Citigroup will take over Wachovia's accounts and absorb billions of dollars in debt.

The British government says it will nationalize troubled British mortgage lender Bradford and Bingley, and assume $75 billion in home loans. The bank's savings division, which has $40 billion in customer accounts, will be sold to Spanish banking giant Santander.

On Sunday, Belgium, Luxembourg, and the Netherlands injected more than $16 billion into banking and insurance giant Fortis, whose profits have tumbled in the past year.

Iceland's government says it is buying a 75 percent stake in the country's third-largest bank, Glitnir.

Authorities in Reykjavik say the move is aimed at ensuring market stability by easing the bank's liquidity problems.

The global banking crisis has largely been linked to lenders making bad home loans and then getting stuck with bad mortgages, shrinking available credit for customers and businesses.

Some information for this report was provided by AP and Reuters.


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