Banking system nearly collapsed in October

City Minister, Paul Myners, has recently revealed that the UK’s banking and financial system was just hours away from meltdown in October of last year. He said that major investors were trying to withdraw their funds on mass, and that this run on the UK’s major banks would have led to a complete collapse of the banking system.

Myners went on to state that it was only panicked behind the scenes measures that helped to avoid the financial meltdown, otherwise the government would have had to nationalise the complete financial system in the UK. He said that the Treasury was already preparing for banks to shut their doors, stop transfers from going through, and stop cash withdrawals from being made.

Myners stated: ‘There were two or three hours when things felt very bad, nervous and fragile. Major depositors were trying to withdraw – and willing to pay penalties for early withdrawal – from a number of large banks.’

A Treasury source also admitted: ‘We faced the very real problem of how banks could stop depositors from withdrawing their money. The banks themselves were selling their shareholdings, accelerating the stock-market falls, and preparing to shut up shop. Mortgages would have been sold on and savers would have been spooked, to put it mildly. It would have been chaos.’