Iceland

Andrew64

Here is the Icelandic Prime Minister's statement on the financial crisis facing Iceland and it's banks. Talk about gloom and doom!

http://eng.forsaetisraduneyti.is/news-and-articles/nr/3035

Tom_Jones

[quote=southcoastsounds;14687865

Personally I'd rather hold my savings in a British Bank on the basis that the host nation is more likely to put its national investors first in the event of meltdown.

[/quote]

Your kidding right, if a bank in this country went under the last people to be looked after would be the investor, ask yourself would the compensation scheme in this country cope with all the claims for a refund, having seen the way british schemes like this work in the past, I doubt it.

My opinion is your covered for 50k in Iceland, ok it maybe a bit more difficult to get your money back, but that's the price you pay for high interest rates, and where are you going to put all this money transfered from Icesave etc, into a UK bank who are probably in a worse position than the Icelandic banks.

I don't like the fact that Icesave lied in their financial statement, i.e. no problems/exposure etc, though, pretty much a worthless statement.

Swipe

So does this mean that if the Icelandic passport scheme fails the rest will not be made up via the FSCS? I'm confused now.

Baldur

Swipe wrote: »

So does this mean that if the Icelandic passport scheme fails the rest will not be made up via the FSCS? I'm confused now.

It's clearly shown in the FSCS FAQs:

4. What is the position of people who have an account with a UK branch of European bank? If you have an account with a UK branch of a bank incorporated in the European Economic Area (EEA) that becomes insolvent, we may also be able to help. Under the EU Deposit Guarantee Schemes Directive, all member states of the EEA are required to establish a deposit guarantee scheme which gives a minimum level of protection for depositors of 20,000 Euros per eligible depositor in the event of a bank failure.
A bank established in another EEA state should be a member of that state's compensation scheme, which is designed to protect depositors in that EEA country, and those with accounts at branches in other EEA countries. Where the bank's home state scheme provides a lower limit of compensation than FSCS (i.e. less than 100% of £50,000), or the scope of protection is less than FSCS's, the bank may choose to join FSCS to 'top up' the level of protection offered by the home state scheme. The link below leads to a list of banks that have topped up into the UK Scheme with their FSA reference numbers and the month and year FSCS or the predecessor scheme accepted their application to top up.
In the event of a failure of one of these banks, there would be a two step process as the home state scheme would have lead responsibility for claims, and would be responsible for paying the first part of any compensation. FSCS is only responsible for paying compensation for the topped up element to £50,000 on deposits with the UK branch. FSCS would, wherever possible, try to assist claimants in their dealings with the home state scheme (for example, by putting them in contact with the home state scheme, or helping them understand the process that the home state scheme will follow). FSCS would then deal with any 'top up' claims.

blizeH

Thanks Baldur. I'm still a bit sure as to where Icesave falls into that category if I'm honest though.

Baldur

blizeH wrote: »

Thanks Baldur. I'm still a bit sure as to where Icesave falls into that category if I'm honest though.

Icesave is covered under the passport scheme, so the FSCS is only resposible for any amount above the home country's scheme, i.e. the difference between the Icelandic scheme's €20,000 and the UK £50,000 cover - see http://www.moneysavingexpert.com/savings/safe-savings#foreign

From the FSCS FAQ above:

FSCS is only responsible for paying compensation for the topped up element to £50,000 on deposits with the UK branch. FSCS would, wherever possible, try to assist claimants in their dealings with the home state scheme (for example, by putting them in contact with the home state scheme, or helping them understand the process that the home state scheme will follow). FSCS would then deal with any 'top up' claims.

blizeH

Thank you. I know it's impossible to say, but I was just wondering what exactly the likelihood you'll get that €20k back!?

I dunno, I currently have around £36k in Icesave and £20k in Kaupthing. KE I'm not too worried about as I know it's fully covered, but Icesave is another matter... I'm trying not to panic (and I'm not panicking as such) - but I'd like to clarify if the money is safe or not I guess

Baldur

As you say - it's impossible to say - at least at the moment.

Andrew64

It all depends on whether the Icelandic government has enough money.

Trollfever

Andrew64 wrote: »

It all depends on whether the Icelandic government has enough money.

They could ask the Icelandic population to donate £1 each to help the UK savers.