kaupthing edge too risky now???

zaccy

Oblivion wrote: »

Just because you have deposited money in a bank, doesn't mean it is still there. The bank will have used your deposits to make loans to others. At the time a bank goes bust, there may be no money left to freeze at all. Hence the need for a guarantee scheme that all other registered financial institutions are required to contribute to when a claim is made.

Dave.

I fully appreciate that Oblivion, that is why a run on a bank, any bank, is so dangerous. The FSCS would have to finance the withdrawals to make my suggestion work.

My point being that the UK FSCS will not prevent a run on a bank as very few people would risk having no access to their savings for 6 months (or more) and suffer loss of interest for that period. The present scheme is only effective for savers in Banks that go belly up without warning.

Nervous_Norbert

Its fine having the first Euro20,000 or so guarenteed by TRYGGINGARSJOPUR, but this depends on shares, etc held by them, with further top ups if needed from Nordic governments ...

How can we have any confidence that there will be any assets to back up the guarentee in such a case ... Iceland government is dwarfed by its banking debts ...


Finally, is there any guarentee on interest earned, or just the initial capital sum ???

isofa

Nervous_Norbert wrote: »

Finally, is there any guarentee on interest earned, or just the initial capital sum ???

Covered a million times on this forum, I suggest a search and a read of the FAQ...