The Bank of England said it would accept a wider range of collateral, including some triple-A rated corporate and consumer loans, from banks under strain from a lack of cash in funding markets.The Financial Services Authority said Friday that it had raised the compensation limit for savings from £35,000 to £50,000, or about $88,000, per claim after signs that bank customers were withdrawing cash to put into perceived safer alternatives.
Several countries have tried to restore confidence among savers this week because of a credit crisis that has raised fears that more bank failures could result in savers losing money. British depositors were unsettled after the government rescued Northern Rock and Bradford & Bingley and broker a takeover of HBOS by Lloyds TSB.
Britain's move on savings accounts fell short of Ireland's complete guarantee for all savers. Some analysts expect deposits to begin flowing into Irish banks as a result of the blanket guarantee.
The Financial Services Authority said that the new compensation ceiling would take effect starting Tuesday and that customers with joint accounts would be eligible to claim up to £100,000. "The chancellor has made clear that the authorities will do whatever is necessary to maintain financial stability and protect depositors," said the financial regulator's chief executive, Hector Sants.The British Bankers' Association said the move would "bring welcome certainty for customers," about 98 percent of whom would be covered.
Several countries have tried to restore confidence among savers this week because of a credit crisis that has raised fears that more bank failures could result in savers losing money. British depositors were unsettled after the government rescued Northern Rock and Bradford & Bingley and broker a takeover of HBOS by Lloyds TSB.
Britain's move on savings accounts fell short of Ireland's complete guarantee for all savers. Some analysts expect deposits to begin flowing into Irish banks as a result of the blanket guarantee.
The Financial Services Authority said that the new compensation ceiling would take effect starting Tuesday and that customers with joint accounts would be eligible to claim up to £100,000. "The chancellor has made clear that the authorities will do whatever is necessary to maintain financial stability and protect depositors," said the financial regulator's chief executive, Hector Sants.The British Bankers' Association said the move would "bring welcome certainty for customers," about 98 percent of whom would be covered.
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