Australian Bank Collapses, Urging Customers To Pull Their Funds
AUSTRALIA - Australian bank, Volt has collapsed in the midst of rising inflation, and the bank has urged its customers to pull their funds from their accounts before it closes them on Tuesday.
The bank staffs 140 people, who will all be jobless after the shutdown, and customers have been urged to pull their funds from their accounts by Tuesday, July 5th.
Volt Bank, which is Australia's first online-only bank will be returning over $100 million in deposits to its customers and handing its banking license to the prudential regulator.
The rising inflation in Australia and interest rates have made it very difficult for online-only banks to compete with the more established lenders.
In May, Australia's central bank had drastically raised inflation forecasts. Political writer, James Melville posted a head of Iceberg lettuce in Australia saying, "now $11.99" with the tags, "#CostOfLivingCrisis and #inflation" next to it.
The Reserve Bank governor Philip Lowe says that he expects that inflation in Australia will hit 7% by the end of the year. Inflation in the United States, by comparison, had already reached $8.6% in the month of May.
Regarding inflation in the United States, the Financial Times reported that "US stocks have suffered their worst first-half drop in more than 50 years in a rout triggered by the Federal Reserve’s attempt to rein in persistent inflation and exacerbated by gathering concerns over global growth".