Kaupthing Edge Savings Rate Frozen For Now

sho_me_da_money

Damn it!

So i maybe i should a mini Cash ISA in my brothers name.

But before i even contemplate opening another ISA - what do you think i shoud do regarding my situation here:

http://forums.moneysavingexpert.com/showthread.html?t=714849

Last message on the above.

Thanks in advance!


Thanks for reading guys!

oldfella

If the author can't get even simple facts right it doesn't do much for my faith in him.

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maybe - but IMHO better not to rush in

Aegis

sho_me_da_money wrote: »

Damn it!

So i maybe i should a mini Cash ISA in my brothers name.

That's tax evasion. I suggest you don't do this...

Greycrow

Fella wrote: »

I wouldn't necessarily rely on that article. For a start it says "I haven’t mentioned the ex-building societies yes just because they are in a group of their own. Northern Rock doesn’t have CDS prices and new savers aren’t protected beyond the legal norms, so obviously I wouldn’t recommend putting your savings there."

If the author can't get even simple facts right it doesn't do much for my faith in him.

I agree, since it's such a well publicized fact. It's hard to understand how any half baked financial pundit could be unaware of Northern Rock's unique position.

Swipe

There's a similar article in the Telegraph regarding the Icelandic banks:

http://www.telegraph.co.uk/money/main.jhtml;jsessionid=BP5FJX510NW0BQFIQMGSFFOAVCBQWIV0?xml=/money/2008/02/03/cniceland103.xml

bristolleedsfan

Another article here, most relevance IMO being

1. No Branches so low cost operations

2. Very few products, so can pay top rates on the ones they do offer. ( like if a newsagent only sold mars bars it would sell loads of mars bars with price being lower than another newsagent offering more choice.

3. Most important.

"But if consumers are still uncertain about the safety of their money, Mr Mountford says they could spread the risk across a number of accounts, as they should in case of risk in any market."

http://www.independent.co.uk/money/loans-credit/the-ice-men-can-melt-savers-hearts-but-will-their-rates-stay-faithful-777324.html


UK Newspapers seem to be forgetting that it was a UK Bank that went into a full blown crisis and other EX Building Societies have had to pay a fortune to gain the funds that they require.

Heres an article on A+L

Press Release - Alliance and Leicester plc

The bank said David Bennett, chief executive, would step aside for a few weeks because of illness and Chris Rhodes, finance director, would take over temporarily.

.................................................. .................................................. .....
FINANCIAL TIMES - ALPHAVILLE

A&L credit losses triple to £185m

Alliance & Leicester, which held abortive takeover talks with Santander, the Spanish bank, last year, has been forced to write down a further £135m on its Treasury investments because of credit market turmoil. A&L had said previously it would write down £55m on investments, but said Tuesday that would now total £185m mainly because of the falling value of holdings in 16 structured investment vehicles.
A&L said it would be able to fund itself until the end of the year.
A&L shares fell 3.5% to 700p on Tuesday as one analyst suggested this would cut into 2007 core operating profits.
Few were surprised at Moody’s suggestion of further writedowns for A&L.


Snipit here on Bradford And Bingley

Bradford & Bingley spikes after Moody’s move

Bradford & Bingley saw a sharp widening in its CDS price on Friday, following a decision by Moody’s to place the mortgage bank on review for a possible downgrade.

The rating agency cited concerns about the bank’s buy-to-let specialist lending business, its growing reliance on wholesale funding and the possible impact on Bradford & Bingley’s profitability.

According to Reuters, the bank’s five-year CDS moved from 130p to 160p in reaction.

Elsewhere, trading in the credit default swap market on Friday morning was quiet and lacked direction ahead of US inflation data due to be released later in the day.
__________________

Mr._H_2

oldfella wrote: »

Interesting/scary article here - Kaupthing get a mention near the bottom (as does Landsbanki) http://www.moneyweek.com/file/41437/...est-banks.html

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having just read this I reckon I will forget the application to Kaupthing

Fella wrote: »

I wouldn't necessarily rely on that article. For a start it says "I haven’t mentioned the ex-building societies yes just because they are in a group of their own. Northern Rock doesn’t have CDS prices and new savers aren’t protected beyond the legal norms, so obviously I wouldn’t recommend putting your savings there."

If the author can't get even simple facts right it doesn't do much for my faith in him.

Well said. The article also states "it’s not clear what protection UK savers might have with these foreign accounts". This is also wrong. It is perfectly clear what protection UK savers have. Both Kaupthing and ICEsave are FSA registered, so UK savers are protected up to £35,000.

ManAtHome

Wouldn't have a problem saving with anyone with the FSCS guarantee, but:
1. Don't bung all/most of your money with them (nobody knows how quickly the scheme will pay out).
2. Don't place much over £30k with them (to allow for interest).

The interesting bit was the potential headroom - if they're currently having to pay around 10% for funds, plenty of room for a bidding war...

Swipe

ManAtHome wrote: »

2. Don't place much over £30k with them (to allow for interest).

I may be wrong, but I was under the impression that the FSA guarantee only covers up to £35K for the amount you deposited rather than what is promised in interest. Feel free to correct me on this if it is not the case.

ManAtHome

Interesting point - most accounts calculate interest daily, so what they owe you will (or should) also increase daily. Time for another dig around...