Government a rock of stability - PM - News in brief

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The Prime Minister told a Downing Street news conference that the action the Government was taking was "unprecedented but essential".

"In extraordinary times, with financial markets ceasing to work, the Government cannot just leave people on their own to be buffeted about," he said.

"For savers, for small businesses, and for homeowners, we must in an uncertain and unstable world be the rock of stability on which the British people can depend."

With Chancellor Alistair Darling at his side, Mr Brown attacked what he described as the "excessive and sometimes undisclosed risk-taking" by financial institutions, sometimes without adequate capital, which led to the current crisis.

The Government is taking a £20 billion stake in Royal Bank of Scotland with a further £17 billion for Lloyds TSB once it is merged with HBOS.

"At this time of uncertainty, we want British banks to be able to lead the world and to be as strong and as well-capitalised as any across the globe," Mr Brown said.

"The Government will not be a permanent investor. Over time we intend to dispose of all these investments in an orderly way. In the meantime, our shares will be held at arm's length."

Mr Brown said the banks which are receiving injections of state cash will have to comply with conditions "to ensure that the taxpayer gets a fair deal" and "bring an end to rewards for failure".

The boards of these banks will receive no cash bonuses this year, said Mr Brown, adding: "Going forward, rewards will only be based on performance and long-term value creation."