Riskiest banks to save with

Steve_xx

nilrem wrote: »

How many UK banks have actually gone bust losing savers their cash in the last 75years? Personally I don't know of any.

That's not the point. What's gone is gone, but what we cannot predict is what will happen in the future.The fact remains that a UK bank could collapse just as much as the US NetBank did last September. In that instance ING took over the depositor book.

So don't imagine that it couldn't happen here.

shown73

I just can't help wondering just how cast-iron this 35000 safety net really is. Has it ever been put to the test? Especially with a foreign based bank. I don't want to sound xenophobic, but if ,say, ICICI suddenly went t--s-up would HMG regard it equally as Barclays or some such? I know that technically we are all safe, as long as we are under this majic figure of 35K, but can you imagine the effect of something like Icesave suddenly getting in to difficulties, with many thousands of investors/savers clamouring for their 35K? I don't know, I have no expertise at all, just a concerned saver, but this smug reliance on a govt safety net does worry me just a wee bit....

[Deleted User]

The money week article is pointless journo scaremongering. Take a subject the public dont understand, print some half truths and then warn of the impending end of the world. Did you know dihydrogen monoxide is the biggest killer in the world and yet government freely expose children to its dangers every day!!!!!!!

If anybody has followed the history of things then we seem to come to the apocalypse with the end of capitalism nigh played every couple of years.

The journos say - this time its different, this time we are really in trouble

I say - heard it a million times before.

Stop believing this rubbish!

Meltdown_2

Steve_xx wrote: »

I think the point I was trying to make earlier was how possible it would be for the Bank of England to support say 4 banks that had gotten into difficulty simultaneously. I mean, how much money is there actually available to prop up these failed banks?

I think it all an unlikely scenario, but not an impossible one. And the government has already signalled that any future similar episodes will be dealt with behind the scenes. Obviously so as not to cause panic.

My guess (for what it's worth) would be that if such a scenario did occur, then it would be "arranged" (no doubt behind the scenes) for China and the oil-rich countries to take up major shareholdings (possibly majority ones?) in the banks.
The end of the world would thus be avoided - at least until that asteroid gets here ...

PasturesNew

chesky369 wrote: »

If everybody kept their savings to the 35k limit with a single bank, then there would be no need for anyone to panic. I do this as a matter of course, so that I don't have to worry about such scare stories.

Easier said than done. I've been moving around and trying to register for many banks and get money into them is proving really difficult.

It's on my To Do List all the time, but I register with a bank, expecting to be able to stick money in it, and they want to write to me and want evidence. And I don't want to register at any address I've been at for the last few months so am using my parents' address for my banking. So it all goes there, then mum sends it to me about 2 weeks later... and by the time it's got to me, I'm onto other things and never give it the time again.

Still need to find more banks too.

I had the same problem with an ISA. Signed up online - then, after I'd put in my (parents') address, they said they were sending me something that I had to reply to quickly. It never reached me in time. Money deposited back at my bank. So I tried again, there was an error message that said to phone a number, I phoned, she said wait a few days as she had no idea why my 2nd application was rejected (might be because 2nd time I tried to use my current address and it could see the aborted previous attempt) ... and I never remembered/lost the number. So have to start again and try again some time.

And I intend on putting some into Premium Bonds. God only knows what that will turn out like.

I'd stick it under the mattress except I don't have a bed. Currently on a sofa bed.

tradetime

nilrem wrote: »

How many UK banks have actually gone bust losing savers their cash in the last 75years? Personally I don't know of any.

That is of course true, but then if this was 2000 you could say "How could a bunch of guys hijack half a dozen passenger jets all at about the same time and fly them into buildings, it's never happened in the history of aviation."
The fact that it hasn't happened yet does not preclude it, the banking system has been evolving and developing continously over the last 75 yrs (to use your timeframe) Financial markets are far more complicated than they were then and far more poeple are investment aware, driving banks to take more and more risks in persuit of shareholder value and big bonuses for the key staff.

nilrem_2

tradetime wrote: »

That is of course true, but then if this was 2000 you could say "How could a bunch of guys hijack half a dozen passenger jets all at about the same time and fly them into buildings, it's never happened in the history of aviation."
The fact that it hasn't happened yet does not preclude it,

IMHO your analogy is not at all relevant to the issue we are discussing, in any case in the past many planes have been hijacked and blown up and planes have in quite a few cases crashed into large buildings maybe terrorists had not put the two together until 2001 but it with the low security it was an event waiting to happen and may well happen again in the future, IMHO that is far more likely than a UK bank collapsing taking savers cash with it!

Steve_xx

nilrem wrote: »

IMHO your analogy is not at all relevant to the issue we are discussing, in any case in the past many planes have been hijacked and blown up and planes have in quite a few cases crashed into large buildings maybe terrorists had not put the two together until 2001 but it with the low security it was an event waiting to happen and may well happen again in the future, IMHO that is far more likely than a UK bank collapsing taking savers cash with it!

Effectively, the Northern Rock bank has collapsed. Without the Bank of England propping it up it would now be in the hands of an administrator. How much more of a reality than that do you need to have?

tradetime

nilrem wrote: »

IMHO your analogy is not at all relevant to the issue we are discussing, in any case in the past many planes have been hijacked and blown up and planes have in quite a few cases crashed into large buildings maybe terrorists had not put the two together until 2001 but it with the low security it was an event waiting to happen and may well happen again in the future, IMHO that is far more likely than a UK bank collapsing taking savers cash with it!

Right, and you think the financial system as operated today is not an "event waiting to happen" fair enough. As for my analogy, it was simply to illustrate that the past does not determine the future. Northern Rock was one of the best things that could have happened to the banking industry, as it has led to a lot of the banks examining their financial models, which should help us avoid this in the future. This can already be seen by a tightening of lending criteria. However, that is for the future, right now there is still the present to get through and the effects of the US sub-prime situation has far from washed through the system, there is still a considerable amount of bad debt out there that was packaged up into all sorts of investment vehicles and fed into the system. The most telling feature of all of this is the reluctance of banks to lend to each other, you and I can sit in our armchairs and speculate all we like about how safe the banks are, but the banks themselves, people who understand far better than I the risk to the banking industry have become very wary of lending to each other, that's good enough for me to exercise a little caution.

Steve_xx

Absolutely spot on - I couldn't agree more.