Rock fallout rolls on with saving rule rejig - Financial Services Recruitment - Emu Consulting

Depositors could see up to £50,000 of their funds protected under new Treasury proposals in the wake of financial collapse of Northern Rock, but banks will not yet be forced to pay into a pre-funded pot.

Setting out the plans in a 169 page report on Tuesday, Alistair Darling, Chancellor of the Exchequer, aimed to toughen up depositor protection rules, with measures which include increasing protectable deposits from £35,000 to £50,000 a person a bank, through the Financial Services Compensation Scheme.

Another proposal is to allow the FSA to collect information on firms on request of the Treasury or the Bank Of England. Presently it can only demand what it can prove it needs for its own regulatory purposes.