Diversify! Diversify! Diversify!

by Mr C Hale
Diversify! Diversify! Diversify!

Ten years on from the banking crisis, where Northern Rock was the first British bank in 150 years to fail as a result of a bank run, diversification within your portfolio has never been more important.

For those that don’t know the term “bank run”, this is used to describe a high volume of customers withdrawing funds from their deposit accounts at the same time. This will happen if depositors believe that a bank is highly likely to become insolvent and, as a result, they will lose some or all of their deposits. Before the financial crisis in 2007/2008, most banks only kept a small proportion of their assets as liquid cash, so if a “bank run” occurs, this becomes a huge problem for the bank.

As a result of the banking crisis, customers are now more sceptical as to who holds their money. It is a valid concern, one that people working in the industry have as well.

After spending your life building up your nest egg, you don’t want to lose it all if a bank becomes insolvent. This is why you should diversify your investments and the banks that endorse your structured products.

As a structured product provider, we think it is vitally important that we offer you a spread of different banks that back our products. This is why we have relationships with multiple banks and are not fixed to one banking institution. At Reyker, we give you opportunities to diversify.

The FCA guidelines for structured products suggest that you should have no more than 10% of your wealth exposed to one bank. This is why we offer a selection of different banks. Citibank have just been added to our list.  

If you would like to talk about structured products and how you can add Citibank to your portfolio, give us a call on 020 7397 2590.

Current structured products on offer