Icesave/Kaupthing - is Martin to blame?

xiox

He wasn't very clear back at the end of 2006:
http://web.archive.org/web/20061231084538/http://www.moneysavingexpert.com/cgi-bin/viewnews.cgi?newsid1098730527,15721,#topaccounts

Landsbanki is new to the UK market and has been popular since its launch, unfortunately this overdemand means it's now announced it may take up to 10 days to respond to e-mail queries. Like ICICI and all UK banks it's FSA-regulated, plus it’s also signed up to the Banking Code.

In March 2007: http://web.archive.org/web/20070305203446/www.moneysavingexpert.com/cgi-bin/viewnews.cgi?newsid1098730527,15721,
This means if the bank collapsed, you’d get the first £2,000 and 90% of the next £33,000 of your savings back. Personally I shove all my cash where it pays the most, yet if you worry, to offset the risk with large savings you could make a rule never to save more than £35,000 with any one institution.

In December 2007:
http://web.archive.org/web/20071202131758/www.moneysavingexpert.com/savings/savings-accounts-best-interest

Banks are like bridges, they almost never collapse but when they do the splash is huge. All legit UK savings institutions are registered with the Financial Services Authority (FSA), which means they're signed up to the Financial Ombudsman complaints service and more importantly the Financial Services Compensation Scheme.

This means if the ridiculously unlikely even a bank went bust, you'd get every penny of the first £35,000 of your savings per institution back. Therefore, while I think it’s a touch of overkill, if you want total peace of mind don’t put more than £35,000 in any bank; spread it around for safety. Full details of the rules, how to do this, and pros and cons are in the Are my savings safe? article.

And on "Are my savings safe?" http://web.archive.org/web/20071206141253/www.moneysavingexpert.com/savings/safe-savings

Q. What are the chances that my bank will go bust?

Extraordinarily, unthinkably, ridiculously unlikely. In September 2007, Northern Rock had to secure an overdraft from the Bank of England due to a crisis in the global money markets, yet even that was nowhere near a full-scale bank collapse. I’m not foolish enough to say “no bank will ever go bust”, but I’m confident enough to give Accrington Stanley a better chance of winning the FA Cup than a UK bank going belly-up. And certainly you’ve a lot less chance of a bank going bust than you have money being stolen from under your mattress!


Q. If a bank did collapse, what protection would I get?

All UK deposits in bank or building society savings products are covered by the Financial Services Compensation Scheme (FSCS). This is effectively a government fund which promises that, in the event of a bank collapsing, you're guaranteed all the first £35,000 of your savings back.

This limit doesn't apply to firms that defaulted before 1 October 2007; then you get 100% of the first £2,000 of your cash back and 90% of the next £33,000 on top; so you'd get £31,700 of the first £35,000 back.

---

It seems a bit misleading to me...

ad44downey

baby_boomer wrote: »

And it successfully stifled discussion.

Not so. It provided a sensible alternative viewpoint to all the scaremongering, malicious rumours and headless chicken type posts.

LucyTheDwarf

xiox - in 2006 not one of us knew what compensation we'd receive, should a bank go bust - because no-one believed it remotely possible. Did anyone see this mess around the corner when the sun was still shining? "Sure, it'll happen one day, but we're all too well off with our credit cards and designer lifestyles for it to happen anytime soon".

From early this year there have been warnings, as these awful messes looked less like horror fiction, and more like horror fact.

Nick_C

LucyTheDwarf wrote: »

in 2006 not one of us knew what compensation we'd receive, should a bank go bust - because no-one believed it remotely possible. Did anyone see this mess around the corner when the sun was still shining?

Perhaps you are very young Lucy, but many of us remember BCCI going bust in 1991 - I had friends who lost a lot of money in it.

Lots of people will have realised that it was quite possible for banks to go bust. Lots more will now learn the hard way.

posh*spice

baby_boomer wrote: »

Martin told the truth on Channel 4 - but not quite the whole truth.

The ethos here in the Savings section chatroom was very supportive of the Icelandic banks. The following post, for instance, got 8 thanks - very unusual in MSE Savings.



There was a fierce campaign against any posters who raised questions about Icelandic banks. They were put down in no uncertain terms - with no intervention from the moderators.

The following posts of mine were less well received:



Then I added this



But this was !!!!ing into the wind on MSE.

The MSE online "culture" - as opposed to Martin's official statements - was pro-Iceland.

This IS THE TOTAL TRUTH about what went on on MSE. It was the people on this board that were PRO-ICELAND and ANTI- REAL WORLD. Martin Lewis gave the right info - the regular posters on this board were in a world of their own and must accept responsibilty.

posh*spice

ad44downey wrote: »

Not so. It provided a sensible alternative viewpoint to all the scaremongering, malicious rumours and headless chicken type posts.

Except they turned out not to be scaremonering or malicious - just a different view point (and possibly more informed) view point from your own:rolleyes::mad:

max121

xiox wrote: »

He wasn't very clear back at the end of 2006:
http://web.archive.org/web/20061231084538/http://www.moneysavingexpert.com/cgi-bin/viewnews.cgi?newsid1098730527,15721,#topaccounts

Landsbanki is new to the UK market and has been popular since its launch, unfortunately this overdemand means it's now announced it may take up to 10 days to respond to e-mail queries. Like ICICI and all UK banks it's FSA-regulated, plus it’s also signed up to the Banking Code.

In March 2007: http://web.archive.org/web/20070305203446/www.moneysavingexpert.com/cgi-bin/viewnews.cgi?newsid1098730527,15721,
This means if the bank collapsed, you’d get the first £2,000 and 90% of the next £33,000 of your savings back. Personally I shove all my cash where it pays the most, yet if you worry, to offset the risk with large savings you could make a rule never to save more than £35,000 with any one institution.

In December 2007:
http://web.archive.org/web/20071202131758/www.moneysavingexpert.com/savings/savings-accounts-best-interest

Banks are like bridges, they almost never collapse but when they do the splash is huge. All legit UK savings institutions are registered with the Financial Services Authority (FSA), which means they're signed up to the Financial Ombudsman complaints service and more importantly the Financial Services Compensation Scheme.

This means if the ridiculously unlikely even a bank went bust, you'd get every penny of the first £35,000 of your savings per institution back. Therefore, while I think it’s a touch of overkill, if you want total peace of mind don’t put more than £35,000 in any bank; spread it around for safety. Full details of the rules, how to do this, and pros and cons are in the Are my savings safe? article.

And on "Are my savings safe?" http://web.archive.org/web/20071206141253/www.moneysavingexpert.com/savings/safe-savings

Q. What are the chances that my bank will go bust?

Extraordinarily, unthinkably, ridiculously unlikely. In September 2007, Northern Rock had to secure an overdraft from the Bank of England due to a crisis in the global money markets, yet even that was nowhere near a full-scale bank collapse. I’m not foolish enough to say “no bank will ever go bust”, but I’m confident enough to give Accrington Stanley a better chance of winning the FA Cup than a UK bank going belly-up. And certainly you’ve a lot less chance of a bank going bust than you have money being stolen from under your mattress!


Q. If a bank did collapse, what protection would I get?

All UK deposits in bank or building society savings products are covered by the Financial Services Compensation Scheme (FSCS). This is effectively a government fund which promises that, in the event of a bank collapsing, you're guaranteed all the first £35,000 of your savings back.

This limit doesn't apply to firms that defaulted before 1 October 2007; then you get 100% of the first £2,000 of your cash back and 90% of the next £33,000 on top; so you'd get £31,700 of the first £35,000 back.

---

It seems a bit misleading to me...

Xiox, good piece of research.

ad44downey

posh*spice wrote: »

Except they turned out not to be scaremonering or malicious - just a different view point (and possibly more informed) view point from your own:rolleyes::mad:

The doomsters sealed their own fate. They caused a run on the bank that no bank could survive. A self-fulfilling prophecy if there were ever one

posh*spice

ad44downey wrote: »

The doomsters sealed their own fate. They caused a run on the bank that no bank could survive. A self-fulfilling prophecy if there were ever one

This is the type of ill informed rubbish that has been peddled on this board. This bank failed not because of 50 people on MSE took out their money but because it its leverage was too high, it was totaly reliant on the now redundant whole sale money markets. Furthermore, these banks cannot be saved as they are bigger than the country they exist in.

The doomsters sealed their own fate - don't make me laugh:rotfl:. My money is Northern Rock.

pumpndump

Who is to blame does not matter. What does matter is some fundamental questions.

What is the reason for putting your money in a bank? Answer, to keep it safe.

So how do you keep it safe? By putting it in a big bank or a building society with decades of history? Or by putting it in a two-bit operation that promises the earth owned by a few amateurs in a pokey little country that makes its money out of selling fish?

I heard Nicky Clarke on the radio this morning talking about Ice-save, and quoting Rnatzen's Law: "If it sounds too good to be true, it probably is."