@cicerone imposter,
cicerone imposter wrote:I have learned long ago never to deposit huge amounts into one bank. That's because a run on the bank can cause problems of liquidity.
In Britain, the government guarantees all bank deposits up to £75,000 (93,000 US dollars) on a per-account basis, but there is a catch, the guarantee applies to all accounts in banks, building societies (savings and loan institutions) etc owned by the same organisation. Since a number of UK banks are now owned by big groups e.g. the Royal Bank of Scotland owns Natwest and Ulster Bank, if you had £75,000 in each of those three banks, and two or more failed, the government scheme would only give you £75,000 altogether. People with over that amount to save have to consult lists of bank ownerships to see how to spread their money to get protection for the whole lot.
I don't mind telling you folks that this is not a problem that is looming on the horizon for me right now. It would if I sold the house I bought 25 years ago.