Isle of Mann Depositor Compensation Scheme

Bebe1980

Anyone familiar with the above.

I'm opening a deposit account with a Class 1(1) Licensed bank there and wondering under what circumstances I might lose my £20K?

I've looked at the scheme details but cannot really say I understand it properly - the UK FCS scheme I can understand - If there's a problem I would be covered up to £85k.



Thanks

[Deleted User]

Bebe1980 said:

Anyone familiar with the above.

I'm opening a deposit account with a Class 1(1) Licensed bank there and wondering under what circumstances I might lose my £20K?

I've looked at the scheme details but cannot really say I understand it properly - the UK FCS scheme I can understand - If there's a problem I would be covered up to £85k.



Thanks

Isle of Man Depositors’ Compensation Scheme (“DCS”) (iomfsa.im)

It's not that difficult - you pick a protected bank, keep below 50k and hope that there isn't a financial crisis as only a limited fund is available from the industry/IOM Treasury . If you owe the bank money, they can opt to net off funds borrowed too.

Bebe1980

Deleted_User said:

Bebe1980 said:

Anyone familiar with the above.

I'm opening a deposit account with a Class 1(1) Licensed bank there and wondering under what circumstances I might lose my £20K?

I've looked at the scheme details but cannot really say I understand it properly - the UK FCS scheme I can understand - If there's a problem I would be covered up to £85k.



Thanks

Isle of Man Depositors’ Compensation Scheme (“DCS”) (iomfsa.im)

It's not that difficult - you pick a protected bank, keep below 50k and hope that there isn't a financial crisis as only a limited fund is available from the industry/IOM Treasury . If you owe the bank money, they can opt to net off funds borrowed too.

Thanks StaceyQ, I'm glad you understand it:

So if my bank is the ONE that fails I'll almost certainly be ok but if two or more banks fail at the same time (constituting a financial crisis by your definition?) I'll probably find myself out of pocket because the fund the IOM treasury has will be shared, in some way, amongst all the depositors of the two or more failing banks?

phillw

Bebe1980 said:
So if my bank is the ONE that fails I'll almost certainly be ok but if two or more banks fail at the same time (constituting a financial crisis by your definition?) I'll probably find myself out of pocket because the fund the IOM treasury has will be shared, in some way, amongst all the depositors of the two or more failing banks?

It's more likely they'll go through bail in

https://www.iomfsa.im/resolution-authority/approach-to-bank-recovery-and-resolution-in-the-isle-of-man/

wmb194

Which bank are we talking about? Surely this affects the risk and worry? If we're talking about HSBC's bank in IoM I wouldn't worry, if it's a tiny local player I'd worry more.