UK banks were ‘three hours’ from insolvency

In a scathing interview with The Times yesterday Lord Myners', Gordon Brown's City Minister, states that the UK's banks almost collapsed last October:

“We were very close on Friday, October 10. There were two or three hours when
things felt very bad, nervous and fragile. Major depositors were trying to
withdraw — and willing to pay penalties for early withdrawal — from a number
of large banks.”

Mind you, we all know that Britain's banks are insolvent now anyway, so what's the problem?

Royal Bank of Scotland's analysts, 17th January 2009: "the
domestic UK banks are technically insolvent on a fully marked-to-market basis."

Not bad considering they paid £650 million ($1 billion) in auditors fees since 2000.