ISA transfer from Santander ONLY in worse case scenario

chequeout

Hi all,

Whilst I am completely confident in Santander UK and I am a big supporter of the bank (I have never had any problems with the so-called bad customer service and I have never found them to be anything less than perfect with my ISAs and savings, also their online banking is faultless) I am aware of the POTENTIAL problems with Banco Santander being downgraded by Moody's ratings agency etc.

I understand Santander UK is ringfenced from Banco Santander etc and has the £85k protected by the FSCS. However, if people do start to panic (which is perfectly possible) and we see a mass withdrawal of funds a la Northern Rock with people queuing round the block then I admit I will be spooked and will consider moving my money away too. Possibly very sheep-like of me considering my words of support of the bank above, but it's the way I will think.

I have around £16k saved in a cash ISA with Santander UK (including this year's 2012 allowance) so IF (and ONLY if) the worst happens and I decide to transfer, I assume I can transfer the whole £16k to another provider as there will be no new money involved, it will be a matter of simply transferring this year's ISA and other years' ISAs from Santander to another provider?

Please note, I am not scaremongering, I am a big Santander fan, but this is playing on my mind so want to be prepared. I have no plans whatsoever to withdraw anything - but if people do panic I admit I will too.

Thanks in advance

Lokolo

You would need to go by the ISA transfer route of opening a new ISA which allows transfers in. Filling in an ISA transfer form and the new provider will then write to Santander asking for funds to be moved across. The process will take around 2 weeks.

If you do it when everyone is panicking then it'll likely be too late.

Gordon_the_Moron

Unless you have more than £69000 more with them other than your ISA money all of your money with them is protected should they go under, nothing to worry about unless you might need it at a days notice. That said I would be as surprised to see them go under as I would any other high street bank.

GrahamBP_2

I have two fixed interest cash ISAs with Santander, so currently I cannot transfer them without penalties. As I understand it, if Santander falls the UK government will pay me the funds that are in those cash ISAs. That means I would not be transferring those cash ISAs to another cash ISA. So does that mean I would lose the tax free ineterest status of those funds?

innovate

Just calm down.

Santander UK deposits up to £85K are at least as safe as similar deposits in any other UK bank.

Search the forum and the main site for "How safe is Santander" etc- -- plenty of posts about it already, and there is absolutely no reason to panic. Or even to be concerned.

innovate

Gordon_the_Moron wrote: »

Unless you have more than £69000 ......

Where does £69,000 come from?

GrahamBP_2

Thanks for your reply. I do understand that up to £85K is protected. But is the tax free interest status of cash ISA funds also protected? I have searched for an answer to that but have been unable to find it.

bryanb

GrahamBP wrote: »

Thanks for your reply. I do understand that up to £85K is protected. But is the tax free interest status of cash ISA funds also protected? I have searched for an answer to that but have been unable to find it.

It was in the Icesave failure, in fact I chose to leave my investments till maturity as I was getting 6% when 4-5% was all I could get elsewhere. The only problem could be the time delay from filling in the claim form to payout by FSCS.

Ultrasonic

innovate wrote: »

Where does £69,000 come from?

The £85k protected maximum minus the £16k the OP said they had in an ISA.

Gordon_the_Moron

innovate wrote: »

Where does £69,000 come from?

In the original chequeout said they had £16000 in a Santander ISA, unless they have over £69,000 more in either a non-ISA Santander account or a different Santander ISA all of the money is protected.

£69,000 == £85,000 limit - the £16,000 that chequeout says the already have in Santander ISA.

Santander share their protection with any accounts branded Alliance and Leicester, Asda, Bradford and Bingley or Cahoot.

Hope that clears things up :-)

Gordon_the_Moron

GrahamBP wrote: »

Thanks for your reply. I do understand that up to £85K is protected. But is the tax free interest status of cash ISA funds also protected? I have searched for an answer to that but have been unable to find it.

Yes it is protected, should a bank/building society that you have an ISA with go bust, you get a certificate of investment rather than cash, you then take that to a new ISA provider and they handle it like a transfer in rather than a deposit.