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Business

EU Approves British Bailout, Opens Probe on German Bank Deal

The bailout of British mortgage lender Bradford & Bingley has been approved by the European Commission, as European authorities further stretch themselves to limit the fallout from the now global financial crisis.

A Bradford & Bingley branch

The go-ahead has been given for the partial nationalization of British lender B&B

The British government -- which plans to prop up B&B with a 50-billion-pound purchase of its mortgage portfolio and the sale of its deposits and branches to Spanish bank Santander -- informed the EU's state aid regulator of the maneuver Tuesday.

"The Commission was able to decide within 24 hours that the state aid measures comply with EU rules on rescue aid," the EU executive said in a statement.

"UK authorities have committed to submit a restructuring and/or liquidation plan within six months, which will be examined by the Commission under its rules on restructuring aid."

Meanwhile, the EU Commission has decided to further its examination into the reconfiguration of German state bank WestLB.

However, in a statement released Wednesday, the EU executive said it was confident of reaching an agreement with German authorities.

"An in-depth investigation provides a good opportunity for discussing the plan submitted in August in greater detail and finding a solution to ensure the long-term viability of WestLB," EU Competition Commissioner Neelie Kroes said.

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