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An article from another financial website
sadabbott
Posts: 85 Forumite
http://www.fool.co.uk/news/your-money/savings/2008/10/07/iceland-in-crisis.aspx?linkplacement=HPcontentbox1
The situation is worse for Icesave. Not only is the bank in receivership, the arrangements for compensation are more complex.
As a first step, savers will have to claim from the Icelandic compensation scheme, run by the Financial Supervisory Authority - Iceland. This will pay out up to €20,887 (around £16,100). Then if you have more than £16,100 in your Icesave account, you can claim the excess up to £50,000 from the FSCS.
The worst case scenario is that the Icelandic government doesn’t even have the money to pay out the £16,100. I don’t think this is a likely scenario, but you can’t rule anything out in the current climate.
If Iceland doesn’t pay, the FSCS will only pay out the excess over £16,100. (We checked this fact with the FSCS this morning - twice.) This is a scary scenario, but my guess is that the UK government would in the end make sure that Icesave savers are fully compensated if Iceland doesn’t pay up.
(By the way, again, domestic Icelandic savers are being treated differently from UK savers. Domestic Icelandic savers have a full guarantee from the Icelandic Government that 100% of their savings are safe.)
I know that many Fools have opened accounts with Kaupthing and Icesave via our site. At least one TMF staff member is in the same boat too. This is a very worrying time for all of these people.
The situation is worse for Icesave. Not only is the bank in receivership, the arrangements for compensation are more complex.
As a first step, savers will have to claim from the Icelandic compensation scheme, run by the Financial Supervisory Authority - Iceland. This will pay out up to €20,887 (around £16,100). Then if you have more than £16,100 in your Icesave account, you can claim the excess up to £50,000 from the FSCS.
The worst case scenario is that the Icelandic government doesn’t even have the money to pay out the £16,100. I don’t think this is a likely scenario, but you can’t rule anything out in the current climate.
If Iceland doesn’t pay, the FSCS will only pay out the excess over £16,100. (We checked this fact with the FSCS this morning - twice.) This is a scary scenario, but my guess is that the UK government would in the end make sure that Icesave savers are fully compensated if Iceland doesn’t pay up.
(By the way, again, domestic Icelandic savers are being treated differently from UK savers. Domestic Icelandic savers have a full guarantee from the Icelandic Government that 100% of their savings are safe.)
I know that many Fools have opened accounts with Kaupthing and Icesave via our site. At least one TMF staff member is in the same boat too. This is a very worrying time for all of these people.
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