WASHINGTON - EMERGING market countries are turning to the International Monetary Fund to help shore up confidence in their financial systems strained by a global credit crunch.

Hungary, Ukraine, Serbia and Iceland all signalled to the IMF during weekend meetings of global finance leaders in Washington they are considering going to the Fund.

Unlike in previous crises in many emerging markets, this is a financial sector crisis as opposed to the balance of payments troubles of the past, and the IMF has urged quick and coordinated actions to limit the damage.

As governments worldwide have pumped more cash into money markets to restart interbank lending, the US outlined a plan to invest US$250 billion (S$366 billion) in its banks but there were still doubts whether it would revive confidence and avert a global recession.

'We have about six or seven countries in the pipeline,' a senior IMF official told Reuters, speaking on condition of anonymity. 'I wouldn't be surprised if there were about a dozen countries after a few months,' the official added.

Tighter credit conditions and fears that bank guarantees in developed economies could see more private capital flow out of emerging market assets has policymakers worried.

The IMF said on Monday it was ready to offer financial and technical help to Hungary, who has a stable banking system but could find it harder to finance its large debt load as credit tightens .

Serbia said it would ask the IMF for a new deal, but an agreement is unlikely to be announced before IMF officials visit Belgrade next month, senior government officials said.

'We are certainly not in a group of emergency cases, such as Hungary,' one official told Reuters. 'But we need the agreement for longer-term stability.'

An IMF official in Washington told Reuters on Monday that Ukraine had sought IMF help, and press reports on Tuesday said an IMF mission is expected in the capital Kiev shortly.

Officials also confirmed that Iceland has asked for IMF financing programme, and is preparing a detailed plan but waiting to see the outcome of talks with Russia on Tuesday over a possible loan.

But the IMF officials question whether a Russian loan will be enough to restore investor confidence in Iceland's battered financial sector, which is what IMF programs are designed to do.

IMF back in business
Over the past several years emerging markets have slowly weaned themselves off the IMF's lifeline as their economies have boomed and private capital has flooded their markets.

Many hurried to pay off the IMF and end their programmes loathing the strict conditions that have traditionally come with fund programmes.

Countries in Asia and Latin America have sworn they will never return to the fund because of the conditions.

'We expect that the IMF's approach will be different in this case than in the past,' Iceland Finance Minister Arni Mathiesen told an Iceland television channel.

IMF Managing Director Dominique Strauss-Kahn has warned that the global financial system is on the brink of meltdown and activated a 1995 emergency procedure at the weekend that promises rapid IMF response and fewer conditions.

By triggering the emergency financing mechanism, Strauss-Kahn, who has been at the IMF for just under a year, is trying to bring more flexibility into the way the IMF lends.

The mechanism would require the IMF board to meet quickly - within 10 days of a country coming to the IMF - and conditions would not be as harsh as would normally apply.

Funding would be front-loaded, meaning that the bulk of the financing would be quickly available, and could be more than a member country's allowed quota under IMF rules.

In Iceland's case, its IMF allowed quota allow it to borrow a small US$180 million a year, although it is seeking 4 billion euros (S$8 billion). Some of that could come from the IMF, some from Nordic partners and the rest from Russia.

Iceland's government last week took over the management of top banks Glitnir, Kaupthing, and Landsbanki, and currency trading has all but ceased.

Emerging market economies, which once seemed immune to the crisis that came out of the United States, are now beginning to see strains in their banking sectors.

Eastern Europe is especially vulnerable because domestic banks have built up large negative net foreign positions through foreign parent banks.

Tightening credit markets, rising domestic interest rates and a sharp slowdown in the global economy could increase the force of the credit squeeze and rising defaults to a large number of emerging markets, the IMF has warned.