Fast buck

It's been interesting watching bankers trying to be reassuring about the state of their sector. Beneath all the bland words and calm exterior, it's pretty obvious they are still in recovery from the shock of what happened on 9 March, when both the parent SVB bank in US and its semi-independent UK subsidiary had to be rescued from collapses that took just hours

The collapse of Barings bank in 1995 was very quick, but that was because one individual was able to bypass rules that are meant to constrain his actions. He took huge risks, made huge losses before anyone could stop him - losses so large that the bank could not survive them and that was that

Barings was not a bank "run" in the way that SVB was. A better comparison is the collapse of Northern Rock on 2007, which was a classic "run" on the bank, caused by a collapse of confidence among savers that their money was safe, accompanied by mass withdrawals. But you will remember that the TV coverage at the time featured long queues of people outside Northern Rock branches, cheque book in hand. It took several days for this scenario to play out and for government and regulators to step in and sort it out. There was time for meetings, discussions, a comparison of options, negotiations

There were no TV cameras filming queues at SVB. The phenomenon was just the same: rumours of a bank in trouble, a cascade of withdrawals leading to more widespread concerns, leading to more withdrawals - a classic "run". But this time it happened with blinding speed, because the news, rumours and panic was mediated by electronic instant messages - interlocking WhatsApp groups and similar means. And people did not grab their cheque book and coat and race to the car. They opened their laptop and started making electronic transfers

A lot of people, with a lot of money to transfer. On the 9th, the US bank had requests to transfer out $42 billion. By the of the 10th it was $142 billion, over 80% of their deposits. Not all of this was actually transferred - the regulator stopped all transfers late on the 9th, giving a lot of US tech companies and their employees a sleepless weekend until a rescue was announced late on Sunday. Similar scenarios played out in UK, just with the decimal point moved over one digit

So, we have lived through the first truly internet-enabled banking crisis. If we are lucky, the regulators are, in reality, less comfortable than the facade they are presenting. If we are lucky, they will have time to do something about it before the next one (and the markets are "testing" the health of financial institutions, in the light of what happened, as the bank of England governor put it), and if we are lucky, what they choose to do will be effective

I looked up the limits on my own money transfers. I have a normal, personal account with a run-of-the-mill building society with mutual ownership. With very few clicks, I could, using only the phone I'm writing this on, transfer out of my account to another one up to £100,000 (well, no, of course I couldn't, but in principle... ). Ten of us in a WhatsApp group could take out £1 million in minutes. I think the banking authorities have only just now realised how prepared in advance they need to be for the speed of crisis this distribution of online power has enabled

There was one brief burst of sunshine amidst the gloom and the rain. I raced out, took just this picture and the sun went in. When circumstances demand it, you have to act fast