Banking Reforms - Update
The Chancellor has announced updated proposals on banking reform. The Treasury, Bank of England and the FSA have published two joint consultation documents setting out these proposals, feeding back on the earlier consultation and outlining planned next steps. These joint consultations will go on until 15 September.
One of the next steps for the FSA is to consult separately on how to make the current compensation arrangements more effective so depositors are more confident in the banking system.
The FSA intend to review the FSCS compensation limits for deposits, and other types of business, and set out a broad range of options. One option could be to increase the current limit for deposits to £50,000, and this is why you may have seen this figure reported in the press. The FSA also intend to publish a second consultation paper in early 2009, look at how fast compensation payments can be made by the FSCS if a bank were to go bankrupt.
Source: FSA
View more Money News