President Bush signed a bill Thursday that would increase financial aid for low and middle-income college students.

Under the legislation, the maximum Pell Grant awarded to poorer college students will increase from the current $4,310 a year to $5,400 by the year 2012. The bill would also cut interest rates for federal student loans in half over the next four years.

Funding for the measure, estimated at $20 billion, will come from cuts in government subsidies to banks.

The bill overwhelmingly passed in both houses of Congress, by a 292-97 vote in the House and a veto-proof margin of 79-12 in the Senate.