In the event of a bank run, do people eventually get their money back? If not, why not?

Question

I understand why banks cannot pay people back in the moment, but wouldn’t they still owe their depositors their money when they eventually DO get the money back presumably once the recession is over?

This is all assuming the bank does not permanently go bankrupt of course. I understand that some banks may just never recover and close their doors for good.

In: 46

Answer 1

In the UK, bank deposits are protected by (IIRC) the Financial Services Compensation Scheme up to £85,000. This is actually pretty good protection against a bank run as there are not very many people with that sort of money sitting in a bank.