Bank of England $100 billion credit crunch plan unveiled today (Reuters) (21-04-2008)

LONDON (Reuters) - The Bank of England has unveiled its plan for alleviating the credit crunch consequences on the British banking system. It is offering to swap government bonds worth 50 billion pounds ($100 billion) for banks' riskier mortgage debt.

The central bank said that asset swaps will be for one year and may be renewed for a total of three years, helping the banks with longer term assistance,  as they are currently unable to find investors for the mortgage debt -- .

The scheme is being guaranteed by the British Treasury but has been designed to avoid the public sector taking on the risk of potential losses.

Analysts said the plan could boost sentiment but would not reverse the impact of the credit squeeze.

Source Reuters