Berlin - Germany's lower house of parliament approved controversial legislation Friday that would enable the state to seize control of troubled mortgage lender Hypo Real Estate.

The measure, seen as a last resort to stabilize the German financial market, marks the first time in modern-day Germany that bank shareholders face possible expropriation.

The legislation, which passed by a vote of 379-107, has to be approved by the upper house before it can become law.

The German government has provided the Munich-based bank with 102 billion euros (137 billion dollars) in state guarantees since it got into difficulties in October 2008.

The government said the bank would only be nationalized if all other attempts by the state to take control fail.

Finance Minister Peer Steinbrueck has said the bank must be saved because of its importance to the German system. (dpa)