Icesave crisis - What happens to those of us with above £50k in our account?

cos69

Just heard the Icelandic PM say on News at 10, that
"its unlikely that Landsbanki in the UK does not have the money to meet the minimum compensation requirements"

If I heard that right, he seems to be saying that our UK savings will be used to cover the minimum compensation requirements ie the €20,000 - could mean there will not be much left over after that.

martinman3

l33tsp33k wrote: »

By the way, the FSCS is funded by the other UK banks... so it's them who are on the hook for 300,000 x £50k.

Unfortunately, this may be the real reason why there has been a hit on the bank shares today and why the "bail-out plan" had to be brought forward.

Even with a £50k limit the total required may be too much for the other institutions to pay through the FSCS.
In the case of B&B a clever piece of accounting meant that the banks and building societies only have to pay the interest on a loan from the BOE until the mortgages are repaid.
In the case of Icesave any loans they have may not be redeemed in a short enough timescale, leaving the other organisations with millions of pounds a year in interest payments.
The effect of all this could be enough to topple some of the smaller building societies that can't make the payments leading to some more mergers.

A full 100% guarantee by the Government may be impossible without bringing down more institutions.
Also, it cannot just give the FSCS the money it needs when it did not do that for the B&B collapse.

This is a real dilemma for Mr Darling.

LK_123

They also mentioned on the news that there are 15,000 people with over £50,000 in IceSave. Is that enough to carry any weight? I think not.

I sold my home six months ago when I moved. I thought I had put the money somewhere safe until I bought a new place. Sadly I put it into the IceSave fixed bond and couldn't get at it. Utterly gutted.

LPHUK

Reaper wrote: »

The chances of success are low. I reckon they have to action it before they declare insolvency, but who knows they may yet be a few days as Iceland is still hoping to keep it running. Send it off first class or faster - the staff there should have little else to do but process it. You have nothing to lose and an outside chance of getting an extra £50,000. Go for it.

Well I would but my partner has decided that she will not sned her original documents (you can't send copies) i.e her passport as she might not get it bak if the bank is going under.

So that's over £20k I could loose because she doesn't want to rick having to replace a passport - thanks a lot!!!!

eric7ru

Hi

it may sounds stupid, by still want to check couple of ideas:

• what about law case against Iceland goverment, if they announce Icesave bankrupt - surely this bank has a lot of assets , i.e. our deposits and loaned all this money to Landansbanki....in my view the reason why they still not announce it bankrupt because it will be very easy to repatriate these money from Parent bank, which kind not going under hence should pay for their obligation! this could freeze any assets of Iceland goverment in UK , which are plenty and will prevent them to sell them untill every transaction will became transparent...surely that will prove that this day light robbery of UK savers!!! Shame on Brown and Darling, they clearly do something about this !!! :mad:
• there thought - announcement that they will fully cover Iceland savers and not cover UK one is in my view clear discrimination based on your nationality - surely court in Hague will support this

in my view if we can arrange class action suite i do not think Iceland will have much to argue about this ....
so what you think - long shot? sounds crazy?
will be welcome your thoughts

iamesbo

I have to say I am surprised that they could lose so much money, where did it all go

I would expect if Iceland could not pay up it's guarantee then surely the British government would have to cough up the full £50,000.

But where did all that money go, I expect it went to where it came from, by and large, into a drop in house prices?

Dustangle

Short_Seller wrote: »

I'd be very surprised if this current administration pays anything over the required 50K. They have always had a "means tested" view from care to welfare to other forms of policy. In this case the mean is clearly the 50K

F*** me sideways! You are actually suggesting that the UK government uses tax payers' money to give an unlimited welfare cheque to people who put money into a foreign bank which is going bust. I can put up with shelling out up to £50k, but an unlimited amount - please, no!

Dustangle

eric7ru wrote: »

Hi

it may sounds stupid, by still want to check couple of ideas:

• what about law case against Iceland goverment, if they announce Icesave bankrupt - surely this bank has a lot of assets , i.e. our deposits and loaned all this money to Landansbanki....in my view the reason why they still not announce it bankrupt because it will be very easy to repatriate these money from Parent bank, which kind not going under hence should pay for their obligation! this could freeze any assets of Iceland goverment in UK , which are plenty and will prevent them to sell them untill every transaction will became transparent...surely that will prove that this day light robbery of UK savers!!! Shame on Brown and Darling, they clearly do something about this !!! :mad:
• there thought - announcement that they will fully cover Iceland savers and not cover UK one is in my view clear discrimination based on your nationality - surely court in Hague will support this

in my view if we can arrange class action suite i do not think Iceland will have much to argue about this ....
so what you think - long shot? sounds crazy?
will be welcome your thoughts

Iceland isn't a county in a far off bit of the British Isles. It's a sovereign state with a small but effective navy, and which looks as if it is about to form an alliance with Russia. It isn't even in the EU and I don't think the ICJ has jurisdiction over this kind of dispute. And its national debt was 500% of its GDP before this thing blew up, when people like some of the posters here thought it would be a good idea to lend them money.

They will tell you - in Icelandic - to jump in the sea.

funkey_monkey

Firstly, to the original poster - vagabond - I'm so sorry to hear about the background to your current situation. Please try not to stress - although I admit I have had a very worried day. I also have savings in Icesave.

Secondly, to the people who keep talking about a foreign bank, Icesave is a UK bank registered in the UK, but owned by an Icelandic bank. Similar to HBOS which was bought over by the Spanish bank Santander. I'm sure there are others too. So, please stop talking tabeloid rubbish as the only real difference is how the compensation scheme works.

Finally, everyone calm down and see what the FSCS and the other parties can do before panicking. This is the first real test of the £50k scheme and we need to wait and see it in action.

eric7ru

LK_123 wrote: »

They also mentioned on the news that there are 15,000 people with over £50,000 in IceSave. Is that enough to carry any weight? I think not.

I sold my home six months ago when I moved. I thought I had put the money somewhere safe until I bought a new place. Sadly I put it into the IceSave fixed bond and couldn't get at it. Utterly gutted.

its actually carry a lot of weight if it class action suite against Iceland goverment on the ground:

• discrimination based on nationality
• quite frankly how come bank which collect only money can go bust- surely it loan all deposits to parent bank, which is not going under

in my view now they are thinking about clever scheme to aggregate all debts at Icesave and then bankrupt it.
however if it law case - automatically all iceland gov assets in UK, which are plenty could be frozen until case will be resolved. DO NOT THINK smart Iceland PM would like this idea.

i think we should try to organise ourselves and file case in the court pretty rapidly....this will also put pressure on UK gov.....surrely 3.5 bln pounds is nothing in current terms
your thougth?