Bank of England on high alert amidst current turmoil

Investors are hunting for points of weakness in banking with risks in the sector remaining high, as the Bank of England keeps a close watch on the sector, governor Andrew Bailey told a UK parliamentary committee on Tuesday.

The British central bank is on high alert amidst the current global turmoil in the banking sector, which was triggered by Silicon Valley Bank’s recent collapse, despite the central bank’s precautions, Bailey believes that the UK is not under stress.

“I don’t think we’re at all in the place we were in in 2007/2008, but we have to be very vigilant, we are in a period of very heightened, frankly, tension and alertness,” said Bailey.

Bailey was questioned by UK lawmakers about the collapse of SVB and Credit Suisse, after SVB UK was bought by HSBC for £1 following its US parent’s fall.

“In my experience, which goes back 30 years now, it’s probably the fastest passage from health to death since Barings,” Bailey added.

Bank of England has been involved in SVB UK until the HSBC purchase was finalized.