what's the chances of ICESave going bust!?

PJD

After selling my house (well hope to exchange any day soon) - I will be renting for a while and have significant savings to put away.

I am tempted by ICESave, - but - well, i've never heard of them before, and would be pretty gutted if they went bust and I lost £3,300 (as I could 'safe guard' myself by only putting in a maximum of £35,000 into that account)

Am I worrying about nothing!!?

whambamboo

I would say so. When was the last time any b ank anywhere in the world went bust? Iceland is not a tinpot third world country.

You're more likely to die in a car crash or something.

Chrismaths

Very very slim. Landsbanki are the bank behind this, and they are A rated (from memory). It's not a risk worth worrying about.

[Deleted User]

Chrismaths wrote:

Very very slim. Landsbanki are the bank behind this, and they are A rated (from memory). It's not a risk worth worrying about.

Not according to this thread, post 239.

Secret_Wookie

Ice Save is run by the same people who run Heritable Bank.

The product itself will be loss making but the money is being used
to bring in balances to lend out for mortgages and balance Landsbanki's overall books with Liabilities.

ING did exactly the same, loss making rate initially, then launch of mortgage products using the savings balances to fund their lending.

This is 1 of the reason new start up saving providers are able to offer high rates initially paying over base rate as they are in growth phase that doesn't require their savings product to turn a profit. They have a good rate gurantee to so make the most of it while the rate is high but don't expect it to last after the rate gurantee expires.

In the mean time looks safe to fill your boots.

climbgirl

Chrismaths wrote:

Very very slim. Landsbanki are the bank behind this, and they are A rated (from memory). It's not a risk worth worrying about.

They're not A rated, they're C rated which isn't good. Moody's does state though, that as Iceland's national bank it's in the govt's interest to keep the bank running if it should fail. But that's not guaranteed. You're protected up to about £32,000.

oldfella

When was the last time any b ank anywhere in the world went bust?

---

BCCI ?

Mike

climbgirl

Can someone explain how the UK Deposit protection scheme works if a bank did go bust? They protect you up to about £32000, but who actually pays?

Chrismaths

2 different things. You're confusing BFSR and deposit and debt rating. BFSR is C, Deposit and Debt rating is A2.

Have a look here for an explanation of BFSR. It says that C is roughly equivalent to A3 (A- in old money). (pg 10)

barak

climbgirl wrote:

Can someone explain how the UK Deposit protection scheme works if a bank did go bust? They protect you up to about £32000, but who actually pays?

You are fully protected only for the first £2000 and then for 90% of the next £33000. Above that you could lose the lot.

The compensation comes from an FSA scheme - see http://www.fsa.gov.uk/consumer/01_WARNINGS/compensation/mn_deposit.html

PJD

thanks very much everyone. Some very interesting information in this thread. Much appreicated.