Reykjavik - Iceland's largest bank group Kaupthing was Thursday taken over by the Icelandic Financial Supervisory Authority.

Kaupthing was the third of the North Atlantic nation's major banks to be taken over by the agency under provisions of special legislation adopted late Monday.

Earlier this week the agency took over Landsbanki and Glitnir.

Kaupthing's domestic deposits were "fully guaranteed" and domestic operations were to remain open for business as usual, the agency said adding that the move was "guarantee a functioning domestic banking system."

Bratislava - The Slovak government Wednesday agreed to provide unlimited guarantees for bank deposits of individuals and small businesses, officials said.

The proposal, in line with such decision taken by Germany and Austria, requires parliamentary approval.

Slovakia currently protects 90 per cent of deposits up to 600,000 Slovak koruny (27,000 dollars).

Slovak banks contribute 0.2 per cent of new deposits to a compensation fund. The government so far does not propose to increase the payments, according to spokesman Branislav Ondrus.

Kiev- The National Bank of Ukraine (NBU) on Wednesday moved to bail out one of the country's banks, extending a low cost credit and banning claims by creditors.

Persons or businesses owed money by Prominvestbank, Ukraine's sixth largest bank, will not be able to press any claims against the company for the next six months, an NBU statement read in part.

Vienna - The Austrian government decided Wednesday to provide unlimited protection for private savings and to guarantee bank liquidity, according to Chancellor Alfred Gusenbauer and Vice Chancellor and Finance Minister Wilhelm Molterer.

By doing away with the 20,000-euro (27,100-dollar) limit on savings guarantees, Austria was following the lead of Germany, which announced Sunday it would introduce unlimited protection.

Stockholm - Sweden's central bank said Wednesday it was to cut its interest rate by 0.50 percentage points to 4.25 per cent.

The cut was to take effect October 15, the Riksbank said, adding that the move was part of a coordinated measure with five other central banks.

The bank's board of governors noted that "economic growth in Sweden is slowing down and that inflationary pressures are diminishing as an effect of the financial crisis."

The Riksbank said it was to revise its forecast for both inflation and GDP, and noted that "the labour market is also showing clearer signs of weakening."

London - The Bank of England Wednesday cut interest rates by 0.5 percentage points to 4.5 per cent, it was announced Wednesday.

Prime Minister Gordon Brown told parliament that the decision to reduce the key interest rate had been taken as part of a worldwide action to combat economic turmoil.

The announcement came a day ahead of the end of the meeting of the Bank of England's Monetary Policy Committee (MPC) Thursday.

Interest rates have remained unchanged at 5 per cent for the past five months, as the Bank of England gave priority to the fight against inflation.