Which banks are a safe haven, which are sitting on shaky foundations, and which are on the verge of collapse? As the worldwide banking industry buckles under the pressure of the credit crunch, we offer you a rolling guide to the safety of savings institutions in the UK.
You can click on each of the names below to get the latest information on each high street savings bank. But first, some explanation.
It is extremely unlikely the UK Government will allow any bank operating in the UK to fail. Moreover, your savings with each UK bank are covered up to £50,000 (up from £35,000 on 7 October).
Therefore, it is best to keep your savings with each of these institutions within that £50,000 compensation limit. Use our safe savings guide to make sure your deposits are safely spread.
Some of these banks will have smaller subsidiaries operating under the same savings compensation licence. If worried, open our table charting bank ownership, look up their banking group and cross-check the name here.
Fitch ratings: These are used as a guide to bank stability based on available funds and ability to repay debts. These ratings run from AAA (the best), down through AA+, AA, AA-, A+, A, A-, BBB+, BBB and BBB- for 'investment grade' banks. 'Investment grade' generally means 'low to moderate risk'. There are 14 levels of ratings below this for 'sub-investment grade' companies. The share prices of publicly traded companies have also been included to give a reflection of market sentiment.
CDS rates: The CDS or credit default swap measures the cost of insuring a bank's debt. So the higher the figure, the riskier the bank... in general: CDS rates can be extremely volatile and depend on how many people are investing in the CDS market that day, what they think of the banking industry generally and how they view that particular bank. They are only of use if a rate is used in conjunction with other indicators and show a consistent trend over a reasonably long period of time. Daily peaks and troughs are not that significant.
Most major banks have a rate between 100 and 300 in a normal environment. But even giant, stable banks such as HSBC have seen rates pushed higher than this usual band during the credit crunch. Again, their use as an assessment tool in isolation is controversial. To see how they reflect a bank's safety, read Fears grow over Icelandic banks (again). For an overview of banks' CDS rates, see the table at the bottom of the page.
IMPORTANT: the following is advice offered to savers on the safest banks for their savings deposits. It is NOT investment advice and should not be regarded as such.
Latest news: UK bank stability drastically improves (15 October 2008)
The market's view of UK banks has drastically improved over the past week, although questions remain over Indian bank ICICI.
UK BANKS
• Abbey
• HBOS
• Royal Bank of Scotland/ NatWest
• HSBC
• Barclays
UK BUILDING SOCIETIES
• Chelsea
• Skipton
• Coventry
• Leeds
FOREIGN BANKS WITH A UK PRESENCE
• Akbank
• Don't miss: Jeff Prestridge on why you should bring your savings home - he names Britain's eight strongest banks and building societies
| Bank | Oct15 | Oct8 | Oct2 |
|---|---|---|---|
| * Unavailable | |||
| ** all rates measured on senior debt repaid over five years | |||
