Ian Jelf wrote:

In message , Al
writes
Nor do I expect them to. Nor did any normal soul expect BCCI to go bust,
given that the BoE had licenced them.

I think you'll find that the bank of England had *not* licensed them as
a Bank and had refused to do so on at least one occasion. They were a
"Licensed Deposit Taker" (I think that's the right phrase). That in
itself would have sent alarm bells wringing with me, not sure about the
rest of you.

You are, of course, right about the nature of BCCIs licence, but one wonders
whether the man in the street is worried about the difference when the B is
BCCI was for 'Bank', even though they weren't licenced as such.

Not that it matters: the BCCIs books were repeatedly certified as 'true and
fair' by Price Waterhouse having obtained assurance from the BoE that such
certification was appropriate (this according to testimony to the US
Congress.)

Why should such certification be any more meaningful to Lloyds' customers
than BCCI's? Why is the FDIC needed in the US if regulatory certification
is 100% good?

And, I put it to you that BCCI being an LDT would not have set alarm bells
ringing with you, because you did not then know that status. Nor do you
know now which banks are similarly licensed today, though I dare say it
won't take you long to find out.

This is all very long a convoluted but it comes down to my original
assertion: while it is unlikely that XYZ bank will go bust, it is not
impossible and therefore is a risk.
--
Al