Bank of England (BoE) Governor Andrew Bailey is testifying, along with Deputy Governor David Ramsden, about the collapse of Silicon Valley Bank (SVB) before the Treasury Select Committee on Tuesday.
Key quotes
Silicon Valley Bank collapse was fastest since Barings.
Credit Suisse was company-specific issue.
I don't think any of these features of recent bank problems are causing stress in the UK.
We are in a period of heightened tension and alertness.
There were a number of possible offers for SVB UK, some set impossible conditions.
We do not want our banks to do that when asked about treatment of Credit Suisse at1 bondholders.
Creditor hierarchy in the UK is a cardinal principle.
Meanwhile, BoE Deputy Governor Dave Ramsden said,” we will keep a close eye on bank funding costs.”
“We need banking solvency procedure as a potential strategy, remains important,” Ramsden added.
Market reaction
GBP/USD is paying little heed to the testimony from the BoE policymakers, hovering at around 1.2300, at the time of writing. The pair is adding 0.13% so far.
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