UK banks set to unveil bailout plans

By Ralph Gowling and Steve Slater

LONDON (Reuters) - Major British banks are likely to announce their plans to recapitalise early Monday, a person familiar with the matter said, a move which could see the government take multi-billion pound stakes in several lenders.

Banks were in crisis talks with the government and regulators Sunday to determine how much capital each needs from the 50 billion pounds offered by Britain last week.

An announcement is expected before the market opens on Monday but details are still being fine-tuned, said the source, who declined to be identified.

The Sunday Times said Royal Bank of Scotland, HBOS, Lloyds TSB and Barclays could ask for a combined 35 billion-pound lifeline.

RBS may need at least 10 billion pounds, HBOS over 5 billion pounds and Lloyds and Barclays more than 3 billion apiece, according to industry sources and analysts' estimates.

That could result in the government becoming the biggest shareholder -- and even a majority investor -- in RBS and HBOS.

Earlier this year RBS shareholders had said Chief Executive Fred Goodwin would need to step down if the bank sought to raise more cash.

The government could take seats on the boards of banks, a government source said Saturday, and Communities Secretary Hazel Blears told the BBC it would be considered.