Federal Treasurer Wayne Swan has held talks with the heads of the nation’s four biggest banks.

Mr Swan met the chief executives of the Commonwealth Bank, NAB, ANZ and Westpac in Canberra tonight, AAP understands.

The meeting comes amid continuing controversy over the federal government’s unlimited guarantee on bank deposits in response to the global financial crisis.

The guarantee has led to a flight of money from unprotected institutions to Australian-owned banks, leading the government to consider imposing an insurance fee for deposits of more than $1 million.

Some investment fund managers have frozen redemptions because of the situation.

Mr Swan today also gave his approval for Westpac’s proposed takeover of St George Bank.

AAP