Effect of Scottish Independence Vote

laser707

I am planning to move my SIPP and ISA account from HL. The two leading companies I want to go with ii and ATS are both based in Scotland. I am concerned about what would happen to my account should Scotland vote for Independence as I wouldn't want my finances to be based outside of the UK and its financial regulation.

Has anyone any thoughts about this?

Do you think my concerns are unwarranted?

ColdIron

This issue, along with many others, is something oily Al has not properly thought through. Scotland has a disproportionately large financial sector for it's size which it simply can't support. RBS alone would have bankrupted them

I wouldn't be unduly worried though, the Scots are overwhelming going to vote No

Buzby

Really? You may be in for a big surprise.

The current posturing and bullying from Cameron is swinging the pendulum - indeed I'm convinced it is a plot to ensure independence. (Scotland invariably ensured Labour got enough seats to give the Tories some element of chance in rotating the govt. With no labour MP's from Scotland, Cameron's party will be unassailable).

The RBS ceased to be a 'Scottish' bank years ago - in much the same way the Bank of Scotland was absorbed into Halifax. As I recall the stupendous losses were cased by the London investment arm so you are most welcome to it.

As for the currency, Scotland had the Pound before its union so there is no reason why it should be lost because of any disassociation. It makes sense (in the short term at least) to stick with Sterling. This may change later, but I wouldn't lose much sleep over it as come 18th September 2014, Sterling will still be accepted.

Yorkie1

There is a thread in the House Prices Debate Board for the debate on the rights and wrongs of the independence ballot. Please don't turn this thread into that one.

OP, even if the vote is Yes, nothing is likely to happen for some months or years afterwards financially. It's not as if the currency will suddenly change the day after the vote. You'll have time to decide what you want to do if there are revised charges etc.

If you think the companies are really the best place for your funds in the meantime, I don't see why you shouldn't go for it, but in the knowledge that you might want to consider changing in a couple of years' time. In the light of that, might be worth checking to see what their exit fees are in case this is the situation you find yourself in.

I have no opinion on whether one company is better than another - don't read that into my post - though.

ColdIron

Buzby wrote: »

With no labour MP's from Scotland, Cameron's party will be unassailable

You say this as if it's a bad thing

innovate

Buzby wrote: »

It makes sense (in the short term at least) to stick with Sterling. This may change later, but I wouldn't lose much sleep over it as come 18th September 2014, Sterling will still be accepted.

Agree, it makes a lot of sense for the scots. Unfortunately, the Yes campaign hasn't fully clicked that it makes next to zero sense for the rest of the UK, and that therefore it won't ever happen. The rest of the UK won't let themselves bully by a minority vote.

In answer to the OP's question: even if they did vote for independence, which I don't think they actually will, but if they did it would take years for the split to actually getting implemented. Some companies, particularly financial ones, would most likely set themselves at least partly up with a UK headquarters before the split. You'd also have ages to transfer your investments onto home territory, probably at no direct cost to you. This is just my personal view - as ColdIron already remarked, oily Al doesn't appear to have thought this through.

GingerFurball_2

ColdIron wrote: »

This issue, along with many others, is something oily Al has not properly thought through. Scotland has a disproportionately large financial sector for it's size which it simply can't support. RBS alone would have bankrupted them

I wouldn't be unduly worried though, the Scots are overwhelming going to vote No

How would RBS have been solely Scotland's responsibilty, when the largest constituent part of the RBS Group is NatWest?

CLAPTON

GingerFurball wrote: »

How would RBS have been solely Scotland's responsibilty, when the largest constituent part of the RBS Group is NatWest?

if the scottish government accepted responsibility for it's banks then as natwest was wholely owned by RBS then it would naturally have to bail out the depositors.

dunstonh

The current posturing and bullying from Cameron is swinging the pendulum

You mean the current bullying and posturing by the nats.

The UK Government setting out its position for the UK and Scotland is logical and has been called on by most so they can see the pros and cons. It is a shame that the nats cant do the same.

How would RBS have been solely Scotland's responsibilty, when the largest constituent part of the RBS Group is NatWest?

If it had remained headquartered in Scotland then the Scottish Government would be protecting the deposits. In reality, there would likely have been some cross border cover provided for deposits but the Scottish Government would not have been able to bail it out. You would likely have seen it broken up with some parts losing their money with the UK protecting its depositors and Scotland unable to protect its depositors. It is messy and complicated and there are multiple ways it could pan out.

However, one thing that is almost certain is that the RBS would be relocated to London with job losses in Scotland.

ColdIron

GingerFurball wrote: »

How would RBS have been solely Scotland's responsibilty, when the largest constituent part of the RBS Group is NatWest?

Natwest are wholly owned by RBS. What I was posing was a hypothetical situation where Scotland was a sovereign state and RBS was incorporated in Scotland

This is unlikely to happen though as the market wouldn't have any confidence in a bank that size that wasn't backed by the UK

innovate

People seem to have very short memories. Within the last 5 years, we have seen two examples of countries going bankrupt, or to the brink of it, because their Financial Services Industry was several times the size of their GDP (Iceland and Cyprus). Last figures I have seen is that the Scottish Financial Sector is over 1,000% of GDP.

We have also seen, and can still see it every day, what a currency union without a fiscal union, can do to countries (Ireland, Greece, Spain) and a whole economic area.

May be the Yes campaign assumes they and the rest of the UK would be immune to the dangers but it would be plain bonkers to do so. More likely, most of the people on the ground don't even begin to understand the issues, and the guys at the top seem to be driven by a strain of megalomania similar to the one Fred the Shred suffered from.