In 2007 the United Kingdom was hit by the global financial crisis that shook the economies in most of the western world. Inspiration for this thesis is found in the effort of determining what caused the financial crisis to emerge, and in the analysis of how things could go so wrong in the United Kingdom’s proud banking sector. The first part of this thesis discusses the term financial crisis and attempts to make a definition of financial crises. Some general considerations on financial crises and economic crises are made and historic financial crises in the UK are described, in order to set the scene for the following chapters. Many causes have been pointed out as at the cause of the financial crisis. Part two of the thesis analyses some of the possible causes of the crisis, and determines whether the individual cause directly or indirectly caused the crisis or if they merely were affecting the crisis after it broke out. The third part of the thesis analyses four major UK banks that have been adversely affected by the crisis. The banks and their history is described for the reader to understand the scale of the institutions that are distressed during the crisis. It is then analysed why the individual bank is distressed and how it is affected by the crisis. Finally, the measures that are taken to get the individual bank through the crisis are analysed. In order to secure financial stability, the British government intervened in the banking sector in October 2008 and January 2009. Part four analyses the British government’s rescue packages and evaluates some of the opinions that have been put forward about the packages. The United Kingdom government has for good reasons been praised for its decisive action to resolve the problems at the distressed banks.
|Educations||MSc in Finance and Accounting, (Graduate Programme) Final Thesis|
|Number of pages||109|