Germany guarantees private savings accounts

The German government said today that it will guarantee all private savings accounts.

German finance ministry spokesman Torsten Albig says the decision to guarantee the savings deposits represents a new direction in actions to help stabilise the economy.

Chancellor Angela Merkel says no citizen should fear for the safety of their savings.

Ms Merkel and finance minister Peer Steinbrueck spoke to reporters today as business leaders and politicians were attempting to devise a new plan to save Hypo Real Estate AG from bankruptcy.

A €35bn bailout plan for Hypo fell apart today.