Will Brown follow Germany and secure UK savings?

by Dave Keating | October 5, 2008 at 10:53 pm

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UPDATE 12:05 GMT: German politians are now saying that Merkel was only making a vague political promise, not outlining a specific blanket bank guarantee for Germany. But British politicians are demanding more clarity. Brown says he will speak with Merkel this afternoon on the situation.

Original:

A day after German Chanellor Angela Mekel announced Germany would guarantee all savings in German banks, everyone is waiting to see if Gordon Brown will follow suit. Currently the UK only guarantees 50,000 pounds of savings, a figure which was just risen from 35,000. Now that Ireland has also guaranteed all savings, there are fears that UK customers will flee to foreign banks.

Prime Minister Gordon Brown is today under intense pressure to guarantee 100% protection for UK savers following Germany's apparent buckling under pressure amid the credit crisis.

In a surprise move Germany last night appeared to follow Ireland and Greece in offering blanket protection to depositors if banks failed.

The change came just days after Britain extended protection from £35,000 to £50,000 in UK banks - and 'ruled out' further protection.