Icelandic Banks

johng_uk

Hi folks - Thanks for looking.

I have read posts on here with regards to the risks with using Icelandic banks.

I have a largish pot of money to invest and am looking to invest it straight away. I have posted with regard to this before (so those who have read before please don't fall asleep!) but would like more specific information please.

I can get 6.62% 1ys fixed with COOP. But Icesave pay 6.7% for 1 ys, 6.76% for 2yr. Kaupthingedge pay a whopping 6.86% over a year. Where should I put my money and what are the risks using Iceland?

Also, when are new bonds likely to be issued and will the rates be lower (probably?)

Thanks in advance.

Toastie

johng_uk wrote: »

Hi folks - Thanks for looking.

I have read posts on here with regards to the risks with using Icelandic banks.

I have a largish pot of money to invest and am looking to invest it straight away. I have posted with regard to this before (so those who have read before please don't fall asleep!) but would like more specific information please.

I can get 6.62% 1ys fixed with COOP. But Icesave pay 6.7% for 1 ys, 6.76% for 2yr. Kaupthingedge pay a whopping 6.86% over a year. Where should I put my money and what are the risks using Iceland?

Also, when are new bonds likely to be issued and will the rates be lower (probably?)

Thanks in advance.

Kaupthing Edge will be safe for a year as they got a years worth of investment (someone will probably shoot me or be able to expand on what happened)

There is alot of speculation with Icesave but i bank with them and i have a 6month fixed bond. I don't have a worry.

As long as you don't exceed the 35k per institution then it will be protected. Kaupthing Edge would probably be best, and the amount is over 5k, especially now they are covered for a year.

johng_uk

Cheers mate. Hopefully someone will expand as it was Kaupthing edge I was looking at.

Toastie

I think they got a loan or something for the coming year to insure stability. Someone older and wiser will come soon.

I forgot to mention as long as it isn't over 35k you'll be covered, on top Kaupthing Edge isn't in the passport system so you don't need to call Iceland to get the money if anything bad happens (hopefully not)

Meltdown_2

And Kaupthing Edge is covered simply by the FSCS (via its Kaupthing, Singer & Friedlander operation). So up to £35,000 is fully covered.

neilp

The issue with Icesave hasn't really been Landsbanki's risk of distress - which is probably much less than Kaupthing, which also may well be overblown. The issue is that Icesave is not totally part of the FSCS. If it collapsed, savers would have to claim back around the first £15,000 from the Icelandic deposit protection scheme, with the FSCS making up the difference (up to £35,000). Kaupthing is fully covered up to £35,000 by the FSCS.

johng_uk

Sounds good to me folks - I'm looking to fill up my 07/08 + 08/09 ISA and will have £27,500 (approx) left to invest for the short - med term (4 years).

Any idea when any 08/09 rates will be issued and would the correct assumption be a fall in savings rates?

neilp

Most 2008-09 rates are already known. As far as I am aware, the best buys are Barclays at 6.5% - with a 1% first year bonus - and Birmingham Midshires, which pays 6.35% but none of this is bonus. For what it is worth I am in the process of opening an account with the latter. It seems like an excellent deal, though - at least from my point of view - it is a bit of a shame that it is postal and there is no online access.

Incidentally, I am surprised the Birmingham Midshires account is not mentioned in the cash ISA article on this site. I guess they must have not spotted it yet!

neilp

Sorry, I misread your message - the perils of surfing when not fully awake! 2008-09 rates will be known from about next March.

Actually, I was right the first time - apologies, again! Like I said, it has taken me a while to wake up this morning!

johng_uk

Thanks for the replies folks. I've just seen another thread on Icelandic Banks and am still wary (maybe that's the ploy by channel 4 - Who knows!)

I think I may go with the CO-Operative banks 1 year fixed savings rate of 6.62%. This leaves Iceland out of the equation and is 'only' a drop of 0.27% from Kaupthing's rate-buster.

Still losing a few hundred £ on a big investment :mad:

loveabargin

johng_uk wrote: »

I think I may go with the CO-Operative banks 1 year fixed savings rate of 6.62%.

This product is currently closed to new business see here
http://www.co-operativebank.co.uk/servlet/Satellite?c=Page&cid=1170748476616&pagename=CB%2FPage%2FtplStandard&loc=l