UK Banking System Is 'Safe' After Credit Suisse Rescue
UK banking system is 'safe' after Credit Suisse rescue. The UK's central bank has stated banks are "secure" after regulators reached a rescue arrangement for Credit Suisse aimed at preventing anxieties over banks spreading.
Author:Morgan MaverickReviewer:Raven NoirMar 21, 20230 Shares120 Views
UK banking system is 'safe' after Credit Suisse rescue. The UK's central bank has stated banks are "secure" after regulators reached a rescue arrangement for Credit Suisse aimed at preventing anxieties over banks spreading.
Although regulators feverishly sought a deal all day on Sunday, the bank was acquired by competitor UBS in a Swiss government-backed agreement.
UK banking system is 'safe' after Credit Suisse rescue. Due to the failure of two minor American banks in recent weeks, there are concerns about the globalfinancial system at this time. Despite the authorities' Sunday intervention, shares of European banks decreased.
After gaining some ground, Deutsche Bank and UBS were trading 1.8% and 3.7% lower, respectively. British banks continued to lose money despite last week's sharpest declines in almost a year.
Yet, analysts do not expect a replay of the financial crisis of 2008, when the bankruptcy of several major banks led to a global recession.
According to the Swiss National Bank, the Credit Suisse rescue plan was the most effective strategy to regain market trust and control economic risk.
In the last-minute sale, Credit Suisse was valued at just over $3.15 billion (£2.6 billion), less than half of its Friday price of $8 billion.
Yet by securing a result before the financial markets opened on Monday, the auction has accomplished what the regulators set out to do.
Former UBS UK Chief Executive Mark Yallop stated that the acquisition of Credit Suisse by his previous employer "should" serve to reassure investors.
He said:
“„This is a takeover of a challenged institution with particular idiosyncratic problems that relate to it specifically [and are] not reflective of broader issues in the banking markets. I think this transaction will definitely stabilise [the bank] and should bring a good degree of confidence back to the banking market more generally.- Former UBS UK Chief Executive Mark Yallop
As a result of the impact of rising interest rates, Mr. Yallop argued that the sale of Credit Suisse should be seen as a distinct event from the failure of two smaller American banks.
Six central banks, including the Bank of England, also declared they will increase the flow of US dollars across the international banking system in an effort to maintain cash availability.
Along with the Bank of England, the Bank of Japan, the Bank of Canada, the European Central Bank, the US Federal Reserve, and the Swiss National Bank, these institutions claimed that the action was "an important backstop to ease strains in global funding markets" and relieve banks of some of the burden.
The "complete set of actions" outlined by the Swiss authorities were praised by the Bank of England.
"We have been engaging closely with international counterparts throughout the preparations for today's announcements and will continue to support their implementation."
It noted the UK banking system was "fully capitalised and funded, and remains secure and sound".
Conclusion
UK banking system is 'safe' after Credit Suisse rescue. The UK's central bank has stated that banks are "secure" after regulators reached a rescue arrangement for Credit Suisse to prevent anxieties over banks spreading.
Although regulators feverishly sought a deal all day on Sunday, the bank was acquired by competitor UBS in a Swiss government-backed agreement.
It happens amid worries about the global financial system following the failure of two smaller US banks in recent weeks.
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Morgan Maverick
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Morgan Maverick is an unorthodox news reporter driven by an insatiable hunger for the truth. Fearless and unconventional, he uncovers hidden narratives that lie beneath the surface, transforming each news piece into a masterpiece of gritty authenticity. With a dedication that goes beyond the boundaries of conventional journalism, Morgan fearlessly explores the fringes of society, giving voice to the marginalized and shedding light on the darkest corners.
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Raven Noir
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Raven Noir is a captivating and enigmatic news reporter who unravels mysteries with a relentless pursuit of truth. Possessing an insatiable curiosity and an astute mind, Raven delves into the depths of complex stories, unearthing secrets that lie beneath the surface. With a masterful grasp of deduction and observation, Raven stands as a beacon of fearless investigation.
In the realm of journalism, Raven is known for his enigmatic presence, drawing people in with an aura of intrigue. Driven by an unwavering passion for unveiling the truth, Raven Noir continues to shed light on the darkest corners of society. Through captivating storytelling and unwavering determination, he challenges conventions and uncovers enigmatic secrets that lie just beyond the surface.
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