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Bank of England considers major reform of deposit guarantee scheme

Overhaul in wake of SVB collapse could look at boost to cover for business accounts and more pre-funding for system
The events around SVB have prompted BoE governor Andrew Bailey and Jeremy Hunt, the chancellor, to call publicly for account protection to be reformed

The Bank of England is considering a major overhaul of its deposit guarantee scheme, including boosting the amount covered for businesses and forcing banks to pre-fund the system to a greater extent to ensure faster access to cash when a lender collapses.

The UK’s Financial Services Compensation Scheme is being urgently reviewed after the rapid failure of Silicon Valley Bank last month, when billions were withdrawn in panic from SVB’s UK subsidiary overnight, people briefed on the BoE’s thinking told the Financial Times.

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