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Icesave - 11 Days Later & We Are No Wiser
Comments
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I wonder how the compensation scheme will handle multiple account holders?
Many people will have a combination of a regular a/c, several fixed-rate a/c each having a different maturity date, monthly/yearly paid interest, Cash ISA, etc
If the FSCS decide to only reimburse accounts after maturity, would we have to submit a separate claim each time a fixed-rate account matured?
Or worse, would the FSCS only allow a single total balance claim once all fixed-rate accounts had matured? This would be crippling if you held a fixed-rate a/c with a late maturity date, as any other accounts would be 'locked in' until then.
Obviously, the above is speculation until the form appears, but ...
Apart from ensuring Cash ISAs can be transferred to another provider, wouldn't the simplest and quickest solution be for the FSCS to reimburse the total balance and ignore maturity dates?0 -
And the Dutch Icesave was very young, they had a lot less savers, hence the faster response times from their government.
The last thing I read on Dutch Icesave was a report that the Dutch compensation plan has hit a snag, too.....ft.com wrote:
Threat to Dutch savers in Icesave
By Michael Steen in Amsterdam
Published: October 15 2008 03:00 | Last updated: October 15 2008 03:00
Plans to compensate savers up to €100,000 ($136,600) for deposits at the Dutch arm of Icesave, a subsidiary of the Icelandic bank Landsbanki, threatened to unravel last night as the country's largest savings bank said it had no intention of helping to fund the rescue.
Rabobank, the agricultural lender that controls about 40 per cent of the Dutch savings market and has a triple A credit rating, said: "At the moment we are not willing to pay the bill for this Icelandic debacle."
Under the existing Dutch deposit scheme, healthy banks must club together to fund payouts when a peer collapses.
Wouter Bos, finance minister, announced last week that the national deposit guarantee was being extended to cover savings of up to €100,000, up from €38,000 previously.
The Dutch central bank said yesterday it would begin processing claims by Icesave depositors.
The first €20,887 is to be paid by Iceland's national deposit scheme, which the Dutch government is effectively underwriting through a loan agreed last weekend in Reykjavik. But the balance is to come from the deposit guarantee scheme. Mr Bos has said he expects the scheme to operate normally unless it threatens a bank's financial health.
However Rabobank said Bert Heemskerk, its chief executive who has led public and private criticism of Icesave's high interest rates, told Mr Bos in Washington last weekend of the bank's unwillingness to pay for the Icesave guarantee.
Icesave had about 125,000 customers in The Netherlands with deposits of €1.7bn."If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks will deprive the people of all property until their children wake up homeless on the continent their fathers conquered."
-- Thomas Jefferson0 -
Yes, be patient. And that draft letter I read earlier was written in very old fashioned English.0
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From: http://www.fairinvestment.co.uk/deals/news/banking-news-Relations-with-Iceland-turn-cold-after-savings-accounts-troubles--2372.html
Relations with Iceland turn cold after savings accounts troubles..The Icelandic Government has said .. this situation is "directly attributable to the extremely harmful actions taken by the British authorities"...The Icelandic Prime Minister, Geir Haarde, reacted with anger when Gordon Brown used anti-terrorist laws to freeze at least £4billion of Icelandic assets in the UK..Mr Haarde has said that he will be appointing a UK law firm to sue the British government for exacerbating Iceland's problems.
This from Executive Intelligence Review..British Credibility on Ice
Oct. 16, 2008 (LPAC) -- The British Empire and its agents on the continent are all attacking the Icelandic government for the meltdown of its financial system, whose true architects are sitting in the City of London. What has them really angry is that they stopped playing by the rules and refuse to honor the derivatives of private banks.
Yesterday Swedish oligarch, arch-liberal parliamentarian and economics professor Carl B Hamilton attacked Iceland in an op-ed in the biggest newspaper on Iceland calling for the toppling of the government as responsible for the bank crisis. Hamilton is totally freaked out on Iceland going to Russia for money instead of IMF. He asks: "Are the conditions and truths of IMF too hard to digest for the government and central bank of Iceland?" He also welcomes Iceland to the EU for control. The article is also published today in Svenska Dagbladet and he was on a radio talk show yesterday. Hamilton is one of the old Scottish families controlling Sweden.
While Icelanders are angry at their government, they are more angry at the British. One irate Icelander, in a comment to the Guardian writes, "The British prime minister (Gordon Brown) has repeatedly said that Iceland, as a country, even as a nation, is going bankrupt, that our government has defaulted on its legal obligation, that we are virtually doomed -- falling into an economic abyss. Neither is true.
"Our currency might be in trouble and that hits us hard, our pay has been significantly devalued by rising costs, our stock exchange is still closed, but the foundations are still stable -- no thanks to Gordon Brown and his menacing rhetoric of last week. And despite what is written in the London tabloids, we still go to work every day, receive our salaries, pay our bills and gather in the pub in the evenings.... Let's look at some facts, shall we? The high-flying, globe trotting business elite that came out of Iceland and started spreading borrowed money all over the UK and Europe has very little to do with the ordinary working public in Iceland. However, for some peculiar reason, the UK media thinks it is all our fault.
He concludes that despite Iceland being a founding member of NATO, "in the end, it seems Russia is Iceland's only friend. Brown's insult to Iceland will be remembered long after this £100m debt has been repaid.""If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks will deprive the people of all property until their children wake up homeless on the continent their fathers conquered."
-- Thomas Jefferson0 -
Just said on BBC TV that it could be MONTHS before the Icesave money is paid back...... that there is no way that the FSCS can stick by the three month expectation.....0
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NEW UPDATE GUYS:
Important Announcements
FSCS proposals for accelerated payment process being considered in Iceland (17 October 2008)
Over 200,000 UK savers with around 300,000 accounts at Icesave, the UK branch of Landsbanki, are a step closer to getting their money back this week, as the authorities in the UK and Iceland work on the process for accelerating the payment of compensation to them.
The FSCS, together with representatives of H M Treasury, the Financial Services Authority and the Bank of England, met with counterparts in Iceland last weekend. Significant progress was made and an accelerated approach to paying compensation was agreed in principle.
Since then, the UK authorities have been working on the detail of alternatives to the conventional, form-based compensation process and these have been put to Icelandic counterparts for consideration.
FSCS Chief Executive Loretta Minghella said today: "Our message to savers entitled to our protection is simple: your money is safe. Our paramount concern is to ensure that you get it back as quickly as possible, so we are doing everything we can to agree an innovative solution which will significantly accelerate the process."
Meanwhile, we have been working closely with the systems operators for Icesave, so that we can get timely access to the data we need to verify claims. We are pleased to report that we are receiving excellent co-operation from them.
The Authorities hope to settle the process over the coming days, and expect to issue guidance next week about how savers will be able to claim their money.0 -
From my own point of view, I had fixed term accounts which weren't due to mature until December, so I wasn't expecting to see my money until then anyway.
For people who compare this with Kaupthing, the takeover wasn't done 'in the blink of an eye', it took over a week and has only just been resolved. This was for a bank that wasn't paying all the money back, just sorting out the mess of cash movements frozen in the system.
It would help if the fscs could publish a clear set of guidelines of intent regarding types of accounts and how each one will be tackled, Interest payment rules, ISA transfers etc.
Even if it will take some time to implement it and they haven't firmed up the exact mechanism, the rules must be close to being set down.0 -
the fscs should really have different scenarios prepared anyway and I am not talking about icesave but contingency plans in general. They should have been able to draw on something in a filing cabinet re estimated time scale.0
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I've just seen this on the news too. They had Paul Lewis on from Moneybox and he's in touch with the FSCS and The Treasury. He said it is going to take 3 - 6 months to get our money back. He says the FSCS is ready to do whatever the Treasury tell them, but they can't do anything without the money. The Treasury are battling it out with Iceland and that could take time. He said that unfortunately people are not likely to get their money back before January next year. He also said they won't pay out some people and not others, it will be all or nothing ! It's all very distressing. I think we need someone to set up a well worded petition on No. 10 website and we need ACTION !! Writing to MPs - anything. Any ideas what to do next?Just said on BBC TV that it could be MONTHS before the Icesave money is paid back...... that there is no way that the FSCS can stick by the three month expectation.....0 -
Just said on BBC TV that it could be MONTHS before the Icesave money is paid back...... that there is no way that the FSCS can stick by the three month expectation.....
Also said that the treasury are probably using the hardship of Icesave depositors as a bargaining tool and that however quickly the FSCS manage to set up a payment system
payments can only be made when they have the money from the treasury. So could be a long wait.0
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