agribank

alanq

I heard this new bank mentioned on Radio 5 Live this morning.

It makes loans only to farmers but anyone can deposit.

Bonds for 3/4/5 years pay 3.35%/ 3.5%/ 3.6% resp.

HOWEVER it is not covered by FSCS and operates on a banking licence from Malta.

"its savings products are not covered by a deposit compensation scheme". I thought that all EU deposits had to be covered up to 100,000 euros by the nation issuing the licence?
http://www.yourmoney.com/your-money/news/2244773/new-bank-offers-rates-of-up-to-36-for-hardpressed-savers

grey_gym_sock

not all loans - even to banks - are deposits. i imagine they've set it up so that these bonds ("bond" can mean anything ) aren't deposits.

3.x% is (IMHO) laughably low for something without deposit protection. when you could get about 6% from some retail bonds.

theGrinch

I wasnt convinced by he spokesman's reason for no FSCS...essentially saying, we are new so dont have it and therefore we can offer table topping rates. Its risky and 3% is no compensation.

sorry to say, but the board is de facto Maltese and fills me with no confidence.

innovate

I would not touch anything maltese with a barge pole.

I have no experience with maltese banks, but I have a lot of experience with maltese bookies, regulated by the LGA (the maltese gambling commission) commissioned by the maltese Finance Ministry.

The exact case goes a few years (2007-ish) back, but essentially there was a maltese bookie who systematically conned players (mainly from the UK) out of several hundred thousand pounds (Betchance, for those of you who remember the scam). You could deposit as much as you liked, you could win lots, but after a while you could never withdraw your winnings, let alone your original deposit. The LGA were as useful as a chocolate teapot to the players, and let the bookie continue its rogue operation for almost a year, despite a barrage of complaints.

Personally, I was very lucky because after I had run out of patience with the bookie and with the LGA, I wrote directly to the Finance Minister, who initially wanted to wash his hands of it. But after a couple of email exchanges with the Finance Ministry, my funds in the bookie were returned (by the bookie) in full within a couple of days. Unfortunately, fellow victims of the bookie weren't so lucky when they tried to replicate my approach - obviously the Finance Ministry weren't prepared to stomp up hundreds of thousands of pounds to compensate all the players. The then Head of the LGA lost his job over the affair. However, I have no reason to believe that anything has substantially changed since 2007.

Banks are obviously different to bookies. However, if the maltese Finance Ministry cannot even regulate a bookie successfully, they stand just about no chance to regulate a bank. (mind you, it's probably the same guys who run banks and bookies - - - they are both gamblers, after all).

Worth mentioning that the maltese Finance Ministry appeared to have the backing, in this matter, of some EC Commissioner in charge of Malta's relationship with the European Union. Said EC Commissioner has retired now, but I remain sceptical as to whether anyone in the EC would have any interest in exposing, and eradicating, the criminal activities of maltese firms.

So, bottom line, my recommendation is avoid any maltese bank like the plague, even if you find they are regulated under some maltese scheme.

theGrinch

maltesers the chocolates are nice though