Stockholm - The Swedish parliament Wednesday approved a stability plan including the establishment of a fund to help banks that run into problems in the future.

Financial Markets Minister Mats Odell said the "stability plan would take immediate effect."

The plan included safeguarding deposits and restoring confidence between the financial institutions.

The government would also take over preferential shares if a bank requested funds.

The government would double the state guarantee to 500,000 kronor (62,000 dollars) for deposits in Swedish-owned banks.

Odell told parliament that Swedish banks were solid but had suffered from "the lack of confidence and had difficulties borrowing from each other."

The plan included a voluntary guarantee fund worth 1.5 trillion kronor (188 billion dollars) for loans due to mature in the coming five-year period, and the stability plan was initially scheduled to run until April 2009.

Odell compared the fund to "an insurance policy" for banks.

Banks or financial insitutions seeking capital from the fund would have to comply with restrictions concerning bonus payments and other benefits to executives, he said.

A 15-billion-kronor fund was also to be created. The Swedish National Debt Office was to manage the fund that was to be financed by the state and banking sector.

Sweden, a member of the 27-nation European Union, has not introduced the joint European currency, the euro. (dpa)