2012-05-24 – London
The Bank of England has announced a series of banking crisis reviews; however, this investigation will fall short of covering the bank run on Northern Rock and satisfying those applying this political pressure.
The review into the Bank’s handling of the 2008 banking crisis will cover three main areas: the bailout of Royal Bank of Scotland and HBOS in 2008 and 2009; the Bank’s general policy about providing liquidity to the financial system; and the (poor) inflationary forecasting capabilities of the monetary policy committee.
Each review will span five months and cover many important questions, not just on the banking crisis but also the way it might handle any future difficulties.
Nonetheless, the reviews will not cover the crisis at Northern Rock – something many feel is of great significance when reviewing any bank bailout policies.
Northern Rock hit financial difficulty in September 2007 when it suffered the first bank run in Britain since Overend, Gurney and Company in 1866.
