HAMILTON, Bermuda (AP) - Legislators in Bermuda have nearly doubled the government's borrowing limit to $1 billion to protect the island from the global economic crisis.

Finance Minister Paula Cox says the new law also created a $250 million financial cushion that can be used if the economy is threatened or at risk.

The approval comes as the government plans to borrow an estimated $147 million to help pay for several capital projects and a new hospital.

The bill was approved on Friday shortly after legislators agreed to buy or guarantee $200 million in preferred stock from Butterfield Bank. Ms Cox said the deal would stabilise the bank and protect depositors.