U.S. President George W. Bush has announced a 250-billion US dollars plan to directly buy shares in the nation's leading banks.

Bush said on Tuesday that the government will initially buy stocks in nine major U.S. banks.

"First the federal government will use a portion of the 700 billion dollar financial rescue plan to inject capital in the banks to purchase equity shares. Second and effective immediately, the FDIC will temporarily guarantee most new debt issued by insured banks. This will address one of the central problems addressing our financial system. Banks had been unable to borrow money and that has restricted their ability to lend to consumers and businesses."

Some of the big banks had to be pressured to participate in the program by Treasury Secretary Henry Paulson. He wanted healthy institutions that did not necessarily need capital from the government to go first, as a way of removing any stigma that might be associated with banks getting bailouts.

"Our goal is to see a wide array of healthy institutions sell preferred shares to Treasury and raise additional private capital so that they can make more loans to businesses and consumers across the nations."

Paulson said the actions are what the government must do to restore confidence in the financial system.

The Treasury chief emphasized that these financial institutions won't be hoarding the new capital, but using it to bolster lending -- to each other and to customers.