The Governor of the Bank of England, Andrew Bailey, has confirmed that the Bank of England is considering raising investor protection on bank savings deposits from £85,000 per individual per banking licence.
The UK’s £85,000 is covered by the Financial Services Compensation Scheme and is still in line with protection in the EU but not as high as deposit protection in the US ($250,000).
Baily suggests that an increase may be due to increase confidence in the banking system given the recent collapse of Silicon Valley Bank (SVB) and the buy out of Credit Suisse.
£100,000 would be the obvious target, given it was at this level when the £ was much weaker and to match the € equivalent. That said, isn’t it easy for the Bank of England to simply increase the limit when it is not the government or the Bank of England that pays the compensation scheme levies, it is all regulated financial services businesses that will have to pay increased levies.