Cyprus surprise - Cypriot depositors to take a 'haircut'

The_Green_Man_2

ILW wrote: »

That does not appear to be the case any more.

Both of these banks were publicly traded companies before the financial crises, so not the same as National Savings as we know them in the UK (NSANDI).

ILW

The_Green_Man wrote: »

Both of these banks were publicly traded companies before the financial crises, so not the same as National Savings as we know them in the UK (NSANDI).

But if the governments guarantees fro private bank deposits are no longer safe, why should direct savings be any different?

CLAPTON

The_Green_Man wrote: »

Do you have information on which companies would have folded if Northern Rock (and I think bradford & bingley) had failed?

I don't have details of which companies bank with which banks but

the failed banks were
northern rock
B&B
RBS
HBOS
and
LLoyds

collectively these banks provided services to probably about half UK businesses; if they closed their doors probably half of the UK people wouldn't have received their pay.

StevieJ

ruggedtoast wrote: »

Russia reacts with fury, rage, and anger.

http://www.independent.co.uk/news/world/europe/furious-russia-slams-cyprus-bailout-deal-as-stealing-as-uncertainty-continues-8548594.html

Russia reacted furiously today to news of the 11th hour European Union bailout of Cyprus - condemning it as 'stealing'.

Remember Shell and BP;)

Shell is being forced by the Russian government to hand over its controlling stake in the world's biggest liquefied gas project, provoking fresh fears about the Kremlin's willingness to use the country's growing strength in natural resources as a political weapon.After months of relentless pressure from Moscow, the Anglo-Dutch company has to cut its stake in the $20bn Sakhalin-2 scheme in the far east of Russia in favour of the state-owned energy group Gazprom.

http://www.guardian.co.uk/world/2006/dec/12/business.oil

The_Green_Man_2

ILW wrote: »

But if the governments guarantees fro private bank deposits are no longer safe, why should direct savings be any different?

The government doesn't guarantee private bank deposits. These are guaranteed via the Financial Services Authority.

"The Financial Services Authority (FSA) is an independent non-governmental body, given statutory powers by the Financial Services and Markets Act 2000. The FSA is funded entirely by fees levied on the industry we regulate. We consult annually on our fee proposals. "

National Savings are guaranteed by the government.

"All the money you save or invest with NS&I will be 100% secure, as we are backed by HM Treasury – there is no overall limit on how much is guaranteed."

The_Green_Man_2

CLAPTON wrote: »

I don't have details of which companies bank with which banks but

the failed banks were
northern rock
B&B
RBS
HBOS
and
LLoyds

collectively these banks provided services to probably about half UK businesses; if they closed their doors probably half of the UK people wouldn't have received their pay.

Lloyds failed because it caved into government pressure to take over HBOS/RBS without due diligence. Had it not bought HBOS then it would have been fine.

So that's three banks, two of which were smaller, regional ones. Had they gone under, the shareholders and depositors would have been clamouring for blood and perhaps the bank's management would not have been able to stroll off into the sunset, pensions and fortunes intact.

cepheus

Now the important stuff........

we fervently hope, kill off Cyprus' entire offshore model which goes far beyond banking deposits, and includes offshore companies and other structures. We know, via specific cases, that Cyprus has been harbouring and protecting vast subterranean funds from activities of the Russian m@fiA, criminal organisations, common thieves, wholesale tax evaders, insider traders, and much more. We know, for instance, that Cyprus has been harbouring illicit gains obtained (partly) through murder.

in the words of a Russian cited in the FT (in an article that deserves a blog all to itself),

“The Cypriots killed their country in one day.”

The Cyprus Mail article is fascinating, for it describes something that we at TJN have long described and will explore in far greater depth, in a forthcoming long paper: the capture of, and capitulation by, an entire nation state, to the offshore financial services industry. And this is the big point that the world's media has largely missed, and which is perhaps the most fundamental of all.

http://taxjustice.blogspot.co.uk/2013/03/cyprus.html

harryhound

CLAPTON wrote: »

I don't have details of which companies bank with which banks but

the failed banks were
northern rock
B&B
RBS
HBOS
and
LLoyds

collectively these banks provided services to probably about half UK businesses; if they closed their doors probably half of the UK people wouldn't have received their pay.

Is there a bit of double counting there? G,Brown managed to sell toxic HBOS to Lloyds.

We had a triple dose of Halifax shares from savings accounts and the mortgage.

Mind you I should have seen it coming, the freemasonry of IT contractors warned me that The Leeds building society was in trouble with the friendly society (?) regulator, for having breached the regulations by lending to highly geared mortgagors, It was scrabbling for outside money.
None of this ever appeared in the press.
In stepped a White Knight in the form of Halifax building society.
Later the "masters of the Universe" merged the now floated Halifax Plc & the Bank of Scotland.

So I suppose I should say THANK YOU to the Lloyds shareholders.

CLAPTON

harryhound wrote: »

Is there a bit of double counting there? G,Brown managed to sell toxic HBOS to Lloyds.

We had a triple dose of Halifax shares from savings accounts and the mortgage.

Mind you I should have seen it coming, the freemasonry of IT contractors warned me that The Leeds building society was in trouble with the friendly society (?) regulator, for having breached the regulations by lending to highly geared mortgagors, It was scrabbling for outside money.
None of this ever appeared in the press.
In stepped a White Knight in the form of Halifax building society.
Later the "masters of the Universe" merged the now floated Halifax Plc & the Bank of Scotland.

So I suppose I should say THANK YOU to the Lloyds shareholders.

Maybe the point is being lost in the detail.

The issue I was trying to make was about the consequences of letting banks fail even when protecting the 'little' person using the FSCS guarantee.
If truly a bank is allowed to fail, that would lead to decent businesses being unable to access their own money and lead to their bankruptcy. The consequences in lost business, unemployment, failed mortgage payments etc might be much more than ordinary people losing their savings.

ERICS_MUM

CLAPTON wrote: »

Maybe the point is being lost in the detail.

The issue I was trying to make was about the consequences of letting banks fail even when protecting the 'little' person using the FSCS guarantee.
If truly a bank is allowed to fail, that would lead to decent businesses being unable to access their own money and lead to their bankruptcy. The consequences in lost business, unemployment, failed mortgage payments etc might be much more than ordinary people losing their savings.

Spot on.

The whole popular debate and hostility against "bailing out the banks" has been focused around the burden imposed on the taxpayer, which clearly is minimal (I don't mean trivial) compared to the burden if the banks were allowed to fail.

Understandably few people will have very little conception of the breadth and width of banking services provided to corporates and other business sectors, nor of the impact on the entire population if these services should fail (i.e. the collapse of our country's infrastructure and money circulation).