Germany guarantees savings as Merkel pushes bank rescue

BERLIN (AFP) - Germany extended a guarantee to all private savings accounts Sunday as Chancellor Angela Merkel said her government was scrambling to salvage a rescue plan for the country’s fourth biggest bank.

Finance ministry spokesman Torsten Albig told AFP that the unlimited guarantee would cover all Germans’ personal deposits as Berlin moved to shore up confidence amid a spreading financial crisis.

Merkel told reporters earlier the government was “pulling out all the stops” to save stricken Hypo Real Estate (HRE) after a banking consortium withdrew from a 48-billion-dollar rescue plan late Saturday.

“The government says today that we will not allow an institution’s crisis to become a crisis for the entire system,” the conservative leader said.

But hitting back at accusations that the government is preparing to bail out fat cats at average citizens’ expense, Merkel warned that those who did irresponsible business would be held accountable. “We owe that to the taxpayers in Germany,” she said.