Mr Darling, Gordon Brown and Lord Mandelson, the Business Secretary, are expected to take the final decision on what extra help to give the banks by the end of the month.
The banks have taken much of the heat for the economy’s woes. But ministers are said increasingly to accept that attacking the banks will not by itself transform a situation that is jeopardising Britain’s economic prospects.
Insiders point out that Mr Darling’s criticism of mortgage lenders has softened in recent weeks.
After the Bank of England’s radical cuts in interest rates ...