Are your savings safe? article discussion

investor7_2

Suzkin wrote: »

I lodged £1k+ with Icesave for 6 months, and now this has been cut short by 5 months.

Will the compensation still include the interest?

Can people with accounts still 'file' for more financial compensation, in that the original terms subscribed to, have been cancelled? i.e. even though I may receive my money back, I've lost the rest of the deal, i.e. the extra 5 months of interest.

I believe that both legally and morally Icesave customers should and will be paid their interest even if it has not actually been added to your account when Icesave went bust. And the following two reasons are the reason why.

1 I believe that the reason that our government bailed out Northern Rock over a year ago was because it realised that it had failed to regulate the Rock properly and realised that there would be a massive political backlash if it failed to bail it out. Similarly it it failed to bail out Icesave customers then it might face a backlash for failing to give all of us sufficient warning about any dangers of investing at Icesave/Landsbanki. They were fully aware of the dangers because apparantly this has been discussed in Parliament at least as early as June this year. And also lets be perfectly clear on this, we the ordinary investor were not remotely miguided to invest in Icesave, afterll many local councils whose finance departments are far more financially astute than the ordinary investor have invested at Icesav.

2 Interest earned is exactly that " earned " . It is money owed to you by your bank, the fact that it has not actually been paid into your account is neither here nor there. Certainly the terms and conditions may say that interest will be credited at the year end but that does not mean that you have not actually earned any interest up untill the date the bank boes bust or the liquidator returns your capital to you. Similarly the terms and conditions do NOT say that in the event of the bank going bust you will not be due any interest earned to date. I also believe that a court of law would uphold this view without question.

So for the above two reasons Icesave customers have absolutely every right to EXPECT all of their interest to be paid to them. And that includes ALL interest which would have been paid to them right up to the date on which their capital is repaid to them, in this case by the governement.

cclarke1804

Here's my long and complicated dilemma:

I've had 6k in a Kaupthing Fixed Term Bond since March this year. It's a 12 month bond. With Kaupthing now taken over by ING Direct, I understand my money's no longer covered by the FSCS but rather a 'Passport scheme' which I'm led to believe would be notoriously more difficult should it come to reclaiming this money in the unlikely (and I'm using the term loosely in light of recent times) event of an ING Direct collapse.
This is just what I gather; that claiming money back direct thru the FSA is less hassle
and frankly a lot quicker than the Passport Scheme. Therefore I'd be better off reinvesting it in a bank covered by the FSA.

So I thought 'Okay, I'll just put it in Nationwide'. I've had savings with Nationwide for years and I remember one of their big selling points being Building Society ∴ no shareholders ∴ no risk. Also, being a UK bank, I'd naturally just assumed they were covered by the FSA but in checking the FSA list (http://www.fsa.gov.uk/pubs/list_banks/2008/sep08.pdf) it appears that I've been wrong.

Aside from the complications involved with withdrawing money mid-term from a Fixed Term bond, given the current economic climate, I feel I need the assurance of the FSCS over my savings. It doesn't seem to make sense to transfer funds from one non-FSA bank to another, so I guess I have several questions:

1. Are building societies really any safer than banks?
2. Is it much wiser to invest in a UK-based bank? And is there any way to find out which is the most stable?
3. Is it worth the effort of trying to retrieve money from a Fixed Term Bond at this stage or am I just being paranoid ?!

Geoffo_M

cclarke1804 wrote: »

Here's my long and complicated dilemma:

I've had 6k in a Kaupthing Fixed Term Bond since March this year. It's a 12 month bond. With Kaupthing now taken over by ING Direct, I understand my money's no longer covered by the FSCS but rather a 'Passport scheme' which I'm led to believe would be notoriously more difficult should it come to reclaiming this money in the unlikely (and I'm using the term loosely in light of recent times) event of an ING Direct collapse.
This is just what I gather; that claiming money back direct thru the FSA is less hassle
and frankly a lot quicker than the Passport Scheme. Therefore I'd be better off reinvesting it in a bank covered by the FSA.

So I thought 'Okay, I'll just put it in Nationwide'. I've had savings with Nationwide for years and I remember one of their big selling points being Building Society ∴ no shareholders ∴ no risk. Also, being a UK bank, I'd naturally just assumed they were covered by the FSA but in checking the FSA list (http://www.fsa.gov.uk/pubs/list_banks/2008/sep08.pdf) it appears that I've been wrong.

Aside from the complications involved with withdrawing money mid-term from a Fixed Term bond, given the current economic climate, I feel I need the assurance of the FSCS over my savings. It doesn't seem to make sense to transfer funds from one non-FSA bank to another, so I guess I have several questions:

1. Are building societies really any safer than banks?
2. Is it much wiser to invest in a UK-based bank? And is there any way to find out which is the most stable?
3. Is it worth the effort of trying to retrieve money from a Fixed Term Bond at this stage or am I just being paranoid ?!

I notice that there are no building societies at all on that link. Does the FSA have a separate list for these that would put your mind at rest?

Baldur

cclarke1804 wrote: »

...So I thought 'Okay, I'll just put it in Nationwide'. I've had savings with Nationwide for years and I remember one of their big selling points being Building Society ∴ no shareholders ∴ no risk. Also, being a UK bank, I'd naturally just assumed they were covered by the FSA but in checking the FSA list (http://www.fsa.gov.uk/pubs/list_banks/2008/sep08.pdf) it appears that I've been wrong.

Nationwide isn't a bank, so it's hardly surprising that it doesn't appear on a list of banks!

If you check the FSA Register, it shows that Nationwide Building Society (number 106078) is authorised by the FSA and, therefore, fully covered by the FSCS.

jimbo5034

So what is the position re savers in Kaupthing who had their funds transferred, by the UK Government, into ING in the event that ING should fail and the Dutch authorities were unable/unwilling to honour guarantee (first 100,000 euros) would the FSCS pay any compensation?

silvercar

Full list of building societies here:

http://www.guardian.co.uk/money

Baldur

silvercar wrote: »

Full list of building societies here:

http://www.guardian.co.uk/money

A list maybe but not a full one, e.g. Monmouthshire BS does not appear on it here, whereas it does on the BSA members list.

silentotter

I have £375,000 to invest after a house sale. If I followed the spread it about rule I would have to open 7 bank accounts! My inclination is to invest it in one of the HMG 100% safety accounts even though I know I would sacrifice interest a bit. I don't want to lock it away for a specified period as we may want access to it. I would rather sacrifice a bit of interest and know the money is safe.

My question is that the Post Office accounts are run by the Bank of Ireland which are part of the passport scheme. Are the products offered by NS&I also run by Bank of Ireland?

We have all seen the debacle of the Icelandic banks that were part of the passport scheme not honouring there agreement. Who's to say that the Irish banks wont do the same.

Silentotter

Oblivion

silentotter wrote: »

My question is that the Post Office accounts are run by the Bank of Ireland which are part of the passport scheme. Are the products offered by NS&I also run by Bank of Ireland?

No, deposits with NS&I are backed by The Treasury 100%. You are effectively lending to the British Government.

Dave.

cvd

Are the products offered by NS&I also run by Bank of Ireland?

No, NS&I is safe - they are guaranteed by HM Treasury.

See the statement at the bottom of this web page
http://www.nsandi.com/index.jsp