The outcome is an unprecedented emergency decision to inject money into the financial system and provide 50 billion-pounds in to stop the stock market fallout as the U.K.'s benchmark FTSE 100 Index has fallen by as much as 7.8 percent with eye-watering sums being wipes of banks share values.

This follows in the footsteps of U.S. President George W. Bush who sanctioned the plan to spend $700 billion late last week in order to help aid US financial institutions by strengthening their balance sheets.

The UK government now joins an extensive list of countries that have stepped in to put in place bailout measures so as to guarantee savers' deposits (U.S., Germany, Ireland, Greece, Spain and Iceland with the later having taken over two of the nation's three biggest banks).

The government announced today that it will make 25 billion pounds immediately available to banks by using tax payers money to buy preference shares and has revealed that they also have another 25 million in reserve for the same action.

The move will not only benefit banks buts also small businesses and home owners, as part of the deal means that banks will require a release from the tightened lending measures in order to reignite the economy.

Despite this though the Confederation of British Industry has revealed that the financial-service sector is likely to cut 12,000 jobs before the end of the year.