Britain says won’t leave ordinary savers unprotected

The British government promised on Monday it would not leave ordinary savers unprotected in the current financial crisis but said it had no plans to respond immediately to a surprise move by Germany to guarantee deposits.
Junior Treasury Minister Yvette Cooper said London was awaiting clarification on the move, which would put intense pressure on Prime Minister Gordon Brown to follow suit to prevent a dangerous imbalance in the European banking sector.
"We can't leave ordinary people and ordinary savers unprotected under these sorts of circumstances," she told BBC radio. "We are still expecting clarification from Germany."
Germany said on Monday it was working on a "Plan B" for its entire banking sector after conceding that case-by-case solutions to the financial crisis may be insufficient, but gave no further details.
Sweden became the latest country to take fresh action on Monday, saying it would expand bank deposit guarantees.
Britain's Finance Minister Alistair Darling will update parliament on the financial situation later on Monday after saying on Sunday that he was "looking at some pretty big steps".
However, Treasury officials said there were no plans for any immediate reaction to Germany's pledge.
Cooper said the government was prepared "to take radical action where it is needed".
Shares in Britain's banks opened sharply lower on Monday as HBOS <HBOS.L> and Royal Bank of Scotland <RBS.L> led the way with falls of 10 to 15 percent.
The decline coincided with weakness across Europe after Germany stepped in over the weekend to rescue mortgage lender Hypo Real Estate <HRXG.DE> and pledged to guarantee all of the country's private deposit bank accounts.
Cooper declined to comment directly on newspaper reports that Darling's "big steps" could include a contingency plan for taxpayers to inject capital into ailing banks, but said:
"Both the Chancellor (finance minister), and the Prime Minister, have said we will of course to whatever it takes to get Britain through this and to make sure that our banking system remains safe."
The first meeting of Britain's new National Economic Council — a group of 17 ministers who will convene to coordinate economic policies across government and help people cope with the fallout from the financial crisis — takes place on Monday.
The council, chaired by Brown with Darling as his deputy, will meet at Brown's Downing Street office and take advice from experts on issues ranging from financial markets, global commodity prices, sustainable energy and barriers to business.