Rescue Plan

The federal government on Tuesday announced a historic plan to restore confidence in the U.S. financial system and to spur banks to begin lending again more normally - both to each other and to consumers and businesses.

Here are the key elements that will be put in place first:

Buying equity in banks

The Treasury will buy up to $250 billion in senior preferred shares in a wide variety of banks...

Backing new debt from banks

The Federal Deposit Insurance Corp. will guarantee new, senior unsecured debt issued by banks, thrifts and bank holding companies. The new debt that will be covered must mature within three years, and banks may opt in to this program until the end of June 2009...

Providing more coverage for bank deposits

The FDIC will temporarily provide unlimited coverage for all non-interest-bearing accounts, which typically are those where businesses park money to cover their near-term expenses such as payroll. The increased coverage will last through the end of 2009...

Buy short-term commercial paper

The Federal Reserve is finalizing plans for a temporary program in which it will buy high-quality three-month debt issued by businesses in the commercial paper market...

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