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Building society savers to get extra protection after mergers
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polyphonic99
Posts: 73 Forumite
Enhanced protection for Building Societies that merge yet keep separate brands eg Nationwide, Derbyshire, Cheshire. This means that existing individual customers of the three societies could have protection for a total of £150,000 – with £50,000 invested in each of the societies. For further details see Daily Telegraph link below
http://www.telegraph.co.uk/finance/personalfinance/savings/3530859/Building-society-savers-to-get-extra-protection-after-mergers.html
Shame they didn't announce this a few weeks ago, when fixed rate deals were still worth having, it would have increased confidence in the Building Society sector and got rid of the fear of losing compensation protection if societies merged. Still better late than never I suppose.
http://www.telegraph.co.uk/finance/personalfinance/savings/3530859/Building-society-savers-to-get-extra-protection-after-mergers.html
Shame they didn't announce this a few weeks ago, when fixed rate deals were still worth having, it would have increased confidence in the Building Society sector and got rid of the fear of losing compensation protection if societies merged. Still better late than never I suppose.
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About time too!
Shame this didn't happen earlier as it would've saved me and many others from having to move 50K sums all over the place when mergers were taking place.0 -
The Financial Services Authority yesterday announced that it was changing its rules to allow merged building societies to maintain separate compensation limits
Nationwide, the UK's largest building society, said customers with savings in Cheshire and Derbyshire building societies would have separate cover once the three societies merge in December.Societies must continue to operate under their former name to qualify, and must make an application to the FSA.
Chelsea Building Society, which will merge with Catholic BS in December said that as the Catholic name would not be continued customers would not qualify for separate compensation limit.
Skipton Building Society said it could not offer the guarantee to customers until it had examined the full details of the change before its merger with Scarborough in the first quarter of 2009
http://uk.biz.yahoo.com/27112008/399/building-society-savers-gain-protection.htmlYorkshire Building Society, which will merge with Barnsley Building Society at the end of December, said it was also delighted with the FSA's decision, and would be taking advantage of the change.0 -
Good news, if a little late for some. It seems very sensible, but surprising they've been able to swing this without retaining separate licences - just separate brands. Interesting to think that some overzealous marketing type might, without thought, remove your compensation cover in the future simply by consolidating logos. :rolleyes:0
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Whilst the principle is welcome, they had better think this rule through: Is it another variation on the FSCS rule - brands for banks in the same group may, or may not be covered, depending on their registration; but building societies in the same group but with different brands that are the result of a merger and that have applied/registered are individually protected whilst the seperate brand is maintained... Clear?
Good - I don't have to worry about my Nationwide FTB & Cheshire FTB exceding the limit... unless they merge before one matures... or they don't register.
Now Mr FSA: What about ING, KE & Heritable ? And B&B and Abbey?
Oh yes they're banks... so? SAME PROBLEM!0 -
...move 50k sums - and suffer penalties for early closure...:mad:About time too!
Shame this didn't happen earlier as it would've saved me and many others from having to move 50K sums all over the place when mergers were taking place.0 -
These comments still don't address the issue that apparently this arrangement will only be in place until next September (as reported in today's Telegraph - Business Section).0
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Although people's money will then be available penalty free - unless they have bonds at both societies with longer periods than 1 year.
If they do have 3 year bonds (Nationwide offered these) or 4 year bonds (Cheshire offered these), it's still a dilemna, as the interest on these bonds will be very valuable as interest rates elsewhere crash.0 -
baby_boomer wrote: »Although people's money will then be available penalty free - unless they have bonds at both societies with longer periods than 1 year.
If they do have 3 year bonds (Nationwide offered these) or 4 year bonds (Cheshire offered these), it's still a dilemna, as the interest on these bonds will be very valuable as interest rates elsewhere crash.
They couldn't have done their homework and established nobody fell into that category.....? No, they wouldn't have thought it through.
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Couldn't find it in telegraph but have seen it elsewhere, too. The choice of date makes it seems to only to be relevant to the NatWide/Cheshire... September is the date tie was announced... giving you only 9 months cover for the enlarged group.These comments still don't address the issue that apparently this arrangement will only be in place until next September (as reported in today's Telegraph - Business Section).
Makes you think that the FSA/FSCS think there is more bad news to come, and they're mitigating their exposure to it...
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