PARIS - GOVERNMENTS of the G7 industrialised countries will discuss on Monday the US government's plan to relieve banks of bad debt and will 'very probably' support it, France's finance minister said.

Ms Christine Lagarde said on the French radio station RMC that the finance ministers and central bank governors of the seven countries would discuss the measures on Monday.

'We will hold a telephone conference to examine and very probably affirm our support for the American plan,' she said.

The US government announced the US$700 billion (S$999 billion) plan late on Sunday in response to a crisis that has seen the collapse, takeover and rescue of several major US financial institutions and rocked the global financial system.

The Group of Seven (G7) brings together the United States, Japan, Canada, Britain, France, Germany and Italy.

Ms Lagarde described the financial crisis as 'a huge upheaval that affects American capitalism.'

She said, 'American banks have toxic items on their balance sheets that no one wants. Result: the system is sick and no one lends to anyone.'

US Treasury Secretary Henry Paulson said on Sunday that the United States was pressing other countries to forge bailouts for their financial institutions similar to the rescue plan.

'I'm... going to be pressing our colleagues around the world to design similar programs for their banks and institutions when they are appropriate,' Mr Paulson said in a television interview on Fox News. -- AFP