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Chancellor to explore raising deposit guarantees
Chancellor Jeremy Hunt has said his government needed to look at raising the level of protection for bank customers following the collapse of Silicon Valley Bank (SVB).
Senior Journalist, covering the Credit Strategy and Turnaround, Restructuring & Insolvency News brands.
Senior Journalist, covering the Credit Strategy and Turnaround, Restructuring & Insolvency News brands.
Hunt explained such a guarantee would be financed by the banking sector but would not follow the American model of making lenders hold extra cash in reserve.
Speaking in Washington DC during the IMF’s spring meetings, the Chancellor said he was “alert” to financial stability risks following three regional American bank collapses and the forced sale of Credit Suisse over the last couple of months. He, however, said Britain’s banking system was far better capitalised than before the financial crisis.
He explained: “We don’t believe we are on the cusp of another 2008, but we monitor what is happening in other parts of the world very carefully, partly because they have an impact in the UK. The notable thing about SVB was the speed at which deposits were transferred.
“We need to look at deposit insurance and keep it under review.”
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