THE HAGUE, Netherlands (AP) -- Prime Minister Jan Peter Balkenende said Monday the Netherlands will guarantee 200 billion euros ($272.78 billion) in loans between banks to help ease the financial crisis.
The Dutch pledge is part of a raft of proposals to unblock frozen credit markets agreed on Sunday in Paris with other governments sharing the euro currency.
Individual packages already announced by the governments of Germany, France, Britain and others add up to well over 1 euro trillion.
Balkenende said the Dutch measure would be operational within days and should help the financial sector return to normal.
"Nearly all banks, however strong their position, are having trouble with liquidity," Balkenende said, blaming the problem on a lack of confidence.
"The government is prepared to guarantee a part of the loans between banks and between financial institutions and banks so that the money stream starts running again," he said.
The Dutch guarantee comes on top of a 20 billion euros fund the government set up last week to support financial institutions in the Netherlands.
Finance Minister Wouter Bos said last Thursday that money would be available to any "essentially healthy" company that requests it.
After the nationalization of the Dutch operations of Fortis NV and ABN Amro earlier this month, the only remaining large Dutch financial companies with stock market listings are bank and insurer ING Groep NV and insurer Aegon NV.
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