Global effort in progress to save banks and financial crash

NEW YORK (AP) -- As the outlook for Lehman Brothers' future appeared to dim Sunday, U.S. and foreign banks joined forces to create a plan aimed at inoculating the global financial system against the investment bank's possible failure, a top investment banking official said.

Banks are in tense talks to create a pool of money worth up to $50 billion to lend troubled financial companies, the official said on condition of anonymity because the discussions were ongoing. And officials at the U.S. Treasury and the Federal Reserve are expected to say they are prepared to be more generous in the Fed's emergency lending program for commercial and investment banks .

The plan comes as top government officials and Wall Street executives hold marathon meetings to save Lehman Brothers. The meetings have failed to find a buyer for the troubled 158-year-old investment bank, raising worries that its likely collapse would disrupt global financial markets.

The official also said the U.S. Treasury Department and the Federal Reserve are pushing Bank of America Corp. to buy Merrill Lynch & Co., though talks are still preliminary.

Expectations that Lehman would survive as a company dimmed Sunday afternoon after Barclays PLC withdrew its bid to buy the investment bank.