Babcock & Brown is expected to extend its share suspension this morning as it hammers out final details of fresh funding agreement with its banks, in a deal that will throw the beleaguered infrastructure funds group a lifeline.

The majority of Babcock's 25-strong banking syndicate, including each of the big four Australian banks, yesterday indicated they were prepared to support the revised proposal under which up to $200m will be injected into the group, giving it time to push ahead with its planned asset sales.

However, Babcock is yet to receive final support for the plan from several smaller European-based banks that require their head offices to sign-off on any new agreement.

The Age