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UK's Financial Services Authority emphasizes bank's stability

The UK's Financial Services Authority has stepped in to reassure bank depositors so as to stem a Depression era-like run on the bank. Although the "queue" is a time-honored British tradition, queueing up to withdraw bank deposits is not. Now in a press release, the UK financial services regulator steps up to restore confidence:
The FSA reiterates that it judges Northern Rock to be solvent and that savers can continue to deposit and withdraw funds.

Clearly, there have been some operational problems with queues at some branches and difficulties with the bank's website caused by the unusually high volumes of customers trying to access their accounts as a result of the publicity surrounding Northern Rock. These problems are entirely logistical and are in no way related to the bank's solvency or its underlying ability to deliver funds to savers who wish to withdraw.

Callum McCarthy, chairman of the FSA, said:

"To be absolutely clear, if we believed that Northern Rock was not solvent, we would not have allowed it to remain open for business. It is open for business and it can continue to receive deposits and allow customers to make withdrawals."
Northern Rock's woes were reported on in Sunday's New York Times. Previously, the FSA had commented:
"The FSA's judgement on Northern Rock is that we believe it is solvent, meets all capital requirements and has a good quality loan book. We are clear it should continue to be open for business.

"More generally, it is important to remember that the UK banking industry has entered this period of severe market turbulence after several years of very strong market conditions which have helped it build up healthy balance sheets and strong capital positions.

"The FSA remains confident about the industry's ability to withstand current market pressures. We are in constant dialogue with firms to ensure that they are vigilant with regard to potential risks and continue to carefully monitor developments."
Would it not be fair to say, in a healthy, positive way, that Big Brother is watching? Emotional states of confidence and optimism are everything in the markets. Hopefully the FSA statement will a go long way toward providing investors with the necessary reassurance.
The Law Offices of Michael H. Cohen offers corporate legal services, litigation consultation, and expertise in health law with a unique focus on holistic, alternative, complementary, and integrative medical therapies. The law firm represents medical doctors, allied health professionals (from psychologists to nurses and dentists) and other clinicians (from chiropractors to naturopathic physicians, massage therapists, and acupuncturists), entrepreneurs, hospitals, and educational organizations, health care institutions, and individuals and corporations.

Michael H. Cohen is Principal in Law Offices of Michael H. Cohen and also President of a nonprofit organization exploring legal, regulatory, ethical, and health policy issues in the judicious integration of complementary and alternative medical therapies (such as acupuncture and traditional oriental medicine, chiropractic, naturopathic medicine, homeopathy, massage therapy, energy healing, and herbal medicine) and conventional clinical care. Michael H. Cohen is author of books on health care law, regulation, ethics and policy dealing with complementary, alternative and integrative medicine, including Healing at the Borderland of Medicine and Religion, Complementary and Alternative Medicine: Legal Boundaries and Regulatory Perspectives (1998), Beyond Complementary Medicine: Legal and Ethical Perspectives on Health Care and Human Evolution (2000), and Future Medicine: Ethical Dilemmas, Regulatory Challenges, and Therapeutic Pathways to Health Care and Healing in Human Transformation (2003).
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Health care and corporate lawyer Michael H. Cohen has been admitted to the Bar of California, Massachusetts, New York, and Washington D.C. In addition to qualifying as a U.S. attorney, he has been admitted and to the Bar of England and Wales as a Solicitor (non-practicing). For more information regarding the law practice of attorney Michael H. Cohen, see the FAQs for the Law Offices of Michael H. Cohen. Thank you for visiting the Complementary and Alternative Medicine Law Blog.
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