Sweeping powers to intervene in failing banks are to be given to the Financial Services Authority as part of a regulatory shake-up by Alistair Darling, chancellor of the Exchequer, to avoid a repeat of the Northern Rock crisis.
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The new measures – which echo those in place in the US – would allow the FSA to seize and protect depositors’ cash when a bank gets into serious difficulty, heading off the risk of a run on the bank.
