Importance of Creditor Hierarchy in UK Banking
Bank of England Governor, Andrew Bailey, emphasized the significance of creditor hierarchy in the UK, stating that it is a "cardinal principle." He assured that additional tier one (AT1) bondholders would experience a different treatment than those involved in UBS's emergency takeover of Credit Suisse.
Adhering to Hierarchy Codes in Resolutions
During a discussion with lawmakers, Bailey reiterated that the Bank of England would consistently follow the hierarchy codes in any resolution, as it is a fundamental principle in the UK's financial system.
Silicon Valley Bank Depositors and Deposit Guarantees
Addressing the protection of Silicon Valley Bank depositors in the US, Bailey expressed that guaranteeing all bank deposits should not be the standard. This statement comes amid ongoing debates about the safety of uninsured deposits above guaranteed levels in multiple countries.