What counts as a British bank?

maxtor

As I see it there are 3 levels of potential protection for bank deposits:
1) A banks own guarantee to give you your money back (reliable under all normal conditions)
2) In abnormal circumstances the FSA compensation scheme (guarantees up to £50000 in most cases)
3) Vague promises from Governments that it will do everything in its power to ensure the financial stability and the widely held belief that the Government would never allow a British deposit bank to go under as it would destroy the UK banking sector and the Government would never be re-elected.

All banks provide (1) for what that’s worth in the current climate. Most banks are covered by (2) or where there are differences such as Icesave, a careful reading of this site will tell you where you stand. But what about (3)? What counts as a “British bank”? Is Kaupthing edge a British bank? Is Abbey?

(not to say there is any problem with these two – in fact I believe Abbey is doing rather well – but is owned by a Spanish bank…)

KingL

your list isn't particularly reflective of the reality, but in your terms, Kaupthing Edge is a (2)

maxtor

OK so K.E is not a British bank and unlikely to fall under (3). What about Abbey? Obviously a (1) and (2) but does it merit a (3)?

Given the current turmoil this might be an important point at some future point.

KingL

It has nothing to do with whether a bank is 'British' or not. The degree of protection is down to whether a bank is signed up to (a) none; (b) a local; (c) the EU passport or equivalent; (d) the UK FSCS or (e) a government-assured protection scheme.

Have a read of this article and read around the forum for more details: http://www.moneysavingexpert.com/savings/safe-savings

Caudle

Whether a bank is considered - by the government - to be British or not may, of course, have a bearing on whether the government chooses to bail that bank out, rather than let the hapless savers rely on the FSCS with all its potential delays and uncertainties.

To that extent it is an important point.

KingL

Indeed, they may be 'voluntary' additional protection offered by the british government over-and-above the range of various advertised protection schemes.

maxtor

KingL wrote: »

Indeed, they may be 'voluntary' additional protection offered by the british government over-and-above the range of various advertised protection schemes.

Let me try to be clear what I'm asking here, if Barclays or Natwest or Lloyds TSB bank went bust tomorrow is the Government likely to allow people with more than £50,000 to loose their money? Are we that far down the slippery slope? Most people believe that the Government would have to step in to prevent total collapse of the banking system.

The question is would they step in if it was Abbey being that it is a Spanish owned bank? Is Abbey a Kaupthing edge or a Natwest?

KingL

Nobody knows.

maxtor

KingL wrote: »

Nobody knows.

After this mornings it would appear we do Ice bank and K.E both count as (3) so Abbey presumably does to

maxmycardagain

If HMG isnt very carful they could rue the day they handed £50B over to the banks, there has been said the eventual total could top £500B, once theyve started the process how do they stop further help AND safeguard taxpayers money?

banks are no more than glorified bookies, can william hills expect a taxpayer handout if things get tough?...

maxmycardagain

Kent council invested £50 MILLION with Ice bank

what a farce.....i thought councils were pleading poverty?...