Lloyds/HBOS savings.

jamesp_3

Nick_C wrote: »

I'm puzzled why you would have so much of your assets in cash. if this is purely a savings pot and you are not between properties, I would have thought you should be spreading it more widely and getting a properly balanced portfolio.

How many balanced portfolios have returned 6.25% during the credit crunch period? Some people prefer the guarantees instead of the risk.

EalingSaver

aggieboy wrote: »

My thinking is that if the Govt' allowed a bank to 'go under' it would be a catastrophe and cause panic. There is also the point the they pushed and allowed this merger and would face massive criticism if it were to fail.

Of course - all perfectly reasonable points. And if they help you sleep better then keep them in mind.

I suppose what I should ask is whether anyone can see anything happening other than a 'worse case scenario' of nationalisation given the Govts' actions so far?

Bear in mind that 'the govt's actions so far' does actually include having allowed several banks to go insolvent, invoking FSCS compensation (B&B for example). The difference being that the taxpayer has underwritten/taken on the liabilities over the FSCS protection limits. Forget the nicety that B&B was shuffled into Santander; it was allowed to go bust in the same breath (or strictly probably in the breath before).

Moreover these are completely extraordinary and probably unprecdented times (bar the 1929-35 (?)). And remember the situation you see today is not necessarily the situation you'll see in 2, 3 4 months time. Who's to say at what point the government will say enough is enough and that the taxpayer should not continue to underwrite exposures over above the FSCS protection, or limit it to some level above but not complete, when there has been plenty of warnings that should have alerted the more cash rich and therefore arguably financially savvy individuals.

some could argue that politically it could be savvy to be seen to be using taxpayer's money to keep e.g. industry x afloat and people in work rather than baling out cash rich individuals who have knowingly taken on a risk.

Look what is happening to Ireland at the moment in terms of perceived risk of default on sovereign debt, which is arguably significantly driven by the govt's decision to make an unlimited guarantee on bank deposits.

uih039

aggieboy wrote: »

Hello all. New poster, but long time lurker, who now needs advice.

In a nutshell, after sitting out the last years problems with my savings(£600,000) locked in at 6.55% I have recently reinvested them. I (like others on here) have taken advantage of having a Halifax reward account paying 6.25% fixed until June, and that's where I've invested it for now.

Having regards the £50,000 gaurantee and troubles at Lloyds, I'm taking the view,(as I did during the last year when it was invested with BoS Int), that the Govt' can't afford to let any bank go under and am thinking of leaving it there. I'm well aware that nobody can read the future but am I completely mad and taking an enormous risk in doing so? Any advice/comments welcome.

I am in a similar position with a substantial sum with divisions of LBG (Halifax, AA, Birmingham Midshires). I am happy with the excellent rates I am getting ranging from 5.5 to 7.21%. I do not lose a single moment's sleep regarding the possibility of LBG collapsing and me losing a single penny of cash. The risk is indeed less than 1% - it is 0%. Relax and enjoy the good rate :T:T

Andrew.