post office savings...not safe now? time to bail?

gozomark

given that anyone who is taking money out of PO or Anglo Irish has a very low threashold risk tolerance (not a criticism, just an observation), I suggest going for safety, and don't worry about interest rate as you will only get spooked again by rumours about the next bank you save with. Northern Rock or NS&I are the safest

Gwhiz

gozomark wrote: »

given that anyone who is taking money out of PO or Anglo Irish has a very low threashold risk tolerance (not a criticism, just an observation), I suggest going for safety, and don't worry about interest rate as you will only get spooked again by rumours about the next bank you save with. Northern Rock or NS&I are the safest

I would agree with that!

Crystallady

Sorry to be thick but I don't understand what's the difference between the PO and NS&I - Ds has a savings acc with Nat Savings and as a struggling student can't afford to lose the £2k or so he has. Should he close it?

gozomark

NS&I - guaranteed by UK Govt
PO - guaranteed by Irish Govt

should he close it ? depends on whether he prefers the Irish or the UK guarantee - which is less likely to go bankrupt.

UK is stronger, but Ireland is in the Eurozone - take your pick

bo_drinker

gozomark wrote: »

given that anyone who is taking money out of PO or Anglo Irish has a very low threashold risk tolerance (not a criticism, just an observation), I suggest going for safety, and don't worry about interest rate as you will only get spooked again by rumours about the next bank you save with. Northern Rock or NS&I are the safest

I agree but our funds were a third of a house sale which we will be using to buy another house. Couldn't take any risks, pity as the P O was performing well interest wise.

Sadsaver

In the light of all the above fears, I wrote to the Post Office at the beginning of March and they have agreed to allow me to close my 'Growth Bond' without any penalty. The question is..Do I go ahead and do it and lose all the potential interest?
Logic dictates that if the Bank failed and the Irish Government was unable to pay compensation, you would think the British Government would have to step in and do an 'Iceland', otherwise there would be a run on the banks with people clammering to get all their savings out of all banks with the rationale that if your money isn't safe in the Post Office, then its not safe anywhere!!
However, logic seems to have gone out of the window with all this current mess.
Am still waiting to be compensated by the UK FSA Compensation scheme, four months after my savings were lost last November in The British 'London Scottish Bank', when it collapsed!!
So, there is little comfort in having your savings in the UK Banking system!!

Andrew64

According to this article, the FSA is concerned about the exposure of British banks and building societies to Irish banks:

http://www.dailymail.co.uk/money/article-1162014/Irish-crisis-hit-mutuals-fears-Financial-Service-Authority.html

jhp

"Financial Mail has repeatedly questioned the UK Treasury, the Financial Services Authority and the FSCS on this subject but they do not appear to have any contingency in place, or at least will not answer questions on the matter.
Royal Mail, the parent company of the Post Office, has refused to answer our questions also. We view it as scandalous that no UK authority here will deal with this issue. The scant facts of the matter are:
• Savers with the Post Office/Bank of Ireland and Anglo Irish have no UK protection whatever, but must rely solely on the Irish scheme. The Irish scheme, like most others, is not funded: it does not have money in hand available to return to depositors. • The UK Treasury has not yet offered any pledge to step in and cover UK savers if the Irish scheme fails."


http://www.thisismoney.co.uk/saving-and-banking/article.html?in_article_id=480476&in_page_id=7

Andrew64

I also note what This Is Money recommends:

• Easy access or variable rate savers
We recommend that money in easy-access, variable rate accounts with the Post Office, Bank of Ireland or Anglo Irish be withdrawn where feasible and moved to accounts in banks authorized and protected in the UK.

kostigovs

http://www.irishtimes.com/newspaper/breaking/2009/0317/breaking10.htm