The £35000 limit is largely irrelevant.

ventureuk

Seemingly nobody will lose money because no financial institution will be allowed to close its doors.

The Govt will step in, nationalise the debt and then sell the deposits, saving all monies at 100% value.

Bank shareholders would have been better off putting their money into used aluminium drinks cans, the returns are higher.

No institution can be allowed to fail due to the huge impact on Govt tax revenues.

If fear caused by a closure took hold and millions took their money out and put it under the mattress then billions would be lost in taxable transactions.

Think about an economy run largely on cash and then consider how the Govt would recover its taxes associated with employment and VAT let alone how much it would lose from not being able to deduct tax from your savings account.

Think about how you paid the builder in cash that you'd earned 'on the side' doing a little work for a friend that he earned in cash selling a few cars from the auction, you get the idea, cut the banks out and tax revenues reduce.

Put simply it's cheaper bailing out a bank and maintaining confidence than letting it fail.

And that's why the £35000 limit is largely irrelevant.

GBY

Although the capital is protected how is interest affected? For example I have savings with Bradford and Bingley, if the savings side is bought by Santander for example, are they obliged to honour the current interest rate and pay it.

ad44downey

ventureuk wrote: »

And that's why the £35000 limit is largely irrelevant.

That's been clear since Northern Rock was nationalised. And I've said it over and over again on here. But certain people keep scaremongering about this £35K limit thing ad infinitum

amcluesent

I've started to hoard cash in the safe at home. Just a few £ thousand in case this gets nasty.

xiox

I can't see the government bailing out foreign banks, like Santander or the Icelandic ones. Personally, I would never put more than 35k in those.

Apreciar

xiox wrote: »

I can't see the government bailing out foreign banks, like Santander or the Icelandic ones. Personally, I would never put more than 35k in those.

Santander are probably the strongest bank in the Eurozone. Why people make such statements without knowing the facts is beyond me.

espresso

ad44downey wrote: »

That's been clear since Northern Rock was nationalised. And I've said it over and over again on here. But certain people keep scaremongering about this £35K limit thing ad infinitum

So why did Darling say that they would raise the limit to £100K over a year ago? here

ad44downey

How much evidence do you need? Forget about all the £35K or £100K limit nonsense. In the case of Northern Rock and now B+B ALL savers money, every single penny is safe. Some people will never be convinced, they like being scared, it's pointless even trying to assuage them

altocumulus

espresso wrote: »

So why did Darling say that they would raise the limit to £100K over a year ago? here

One year is a loooonnnnggggg time.....

Paul_Herring

amcluesent wrote: »

I've started to hoard cash in the safe at home. Just a few £ thousand in case this gets nasty.

If it gets that bad, do you think you'll be able to use all that useless paper?

Norman-B

amcluesent wrote: »

I've started to hoard cash in the safe at home. Just a few £ thousand in case this gets nasty.

Whisper to me! Where is the safe? I won't tell anyone, honest.