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  • FIRST POST
    • occamsrazor
    • By occamsrazor 7th Oct 08, 12:28 AM
    • 229Posts
    • 63Thanks
    occamsrazor
    Icelandic Banks - The thread for OFFSHORE savers
    • #1
    • 7th Oct 08, 12:28 AM
    Icelandic Banks - The thread for OFFSHORE savers 7th Oct 08 at 12:28 AM
    (Edited 9th Oct ) This thread is about Offshore accounts with Icelandic banks such as Landsbanki Guernsey and Kaupthing Isle of Man - not about UK accounts. There were previously one or two other threads about offshore accounts - please now keep all posts about offshore accounts with Icelandic banks on this thread so we can keep all the information in one place and make it easier for people to follow developments.
    Thanks.


    Despite the recent bad news about Icelandic banks, UK savers at least have the UK FSCS £50k protection to reassure them. This thread is for savers of Icelandic banks (and others I guess) with accounts based in the Isle of Man (IOM), Jersey, Guernsey, etc - all of which are not covered by the UK compensation scheme. There are many reasons why some people have accounts with these banks but one important one is that many savers have been forced to go offshore because most UK-based banks will no longer open accounts for non-UK-residents - e.g. British expats.

    Jersey & Guernsey have no depositor compensation schemes I am aware of.

    The Isle of Man depositor's compensation scheme is this: "The DCS compensates people who have money in current and deposit accounts in the Isle of Man with 75% of up to £20,000 of net deposits per depositor per bank, if the bank fails. This means maximum compensation payable is £15,000 per depositor – this amount would be paid to someone with £20,000 or more."

    http://www.gov.im/FSC/investor/dep_comp.xml

    In the case of Kaupthing's Isle of Man operation - Kaupthing Singer and Friedlander (Isle Of Man) Limited is a wholly owned subsidiary of the Kaupthing parent company Kaupthing Bank hf, and all funds are also guaranteed 100% by them (for what that's worth).

    http://www.kaupthingsingers.co.im/about-us/kaupthing
    http://www.kaupthingedge.co.im/About/KaupthingBank.aspx

    Personally I have been very happy with the really outstanding service (especially by telephone) of Kaupthing IOM. The service is by far the best I have received from any bank I have ever dealt with.

    However the Isle of Man depositor's compensation scheme is weak compared to the UK one, and this concerns me.

    What are the implications of the recent events and guarantees etc for us offshore savers?

    Do any of the guarantees of the subsidiary by the parent company entitle us also to compensation under the parent company's home-country scheme e.g. the Icelandic scheme in the case of Kaupthing?

    Any other thoughts?
    Last edited by occamsrazor; 09-10-2008 at 12:15 PM.
Page 1
    • TCA
    • By TCA 7th Oct 08, 12:53 PM
    • 1,408 Posts
    • 828 Thanks
    TCA
    • #2
    • 7th Oct 08, 12:53 PM
    • #2
    • 7th Oct 08, 12:53 PM
    I set up 2 withdrawals from my Kaupthing Edge Offshore saver (IOM) for the 6th and 7th October and yet my balance remains the same as of now and my future and pending transactions which were showing before, are now sitting in the messages outbox.

    I guess they're busy........
    • occamsrazor
    • By occamsrazor 7th Oct 08, 1:05 PM
    • 229 Posts
    • 63 Thanks
    occamsrazor
    • #3
    • 7th Oct 08, 1:05 PM
    • #3
    • 7th Oct 08, 1:05 PM
    TCA - I have experienced similar situation, however I think it is just a case of their website not reflecting recent changes. I phoned them about some transfers that were "pending" yesterday but no longer were, and they confirmed they were still being processed....
    A previous transfer last week arrived in my linked account before it was shown as withdrawn from my Kaupthing account, so I think it is just a question of the website being slow to update...
    • DonnySaver
    • By DonnySaver 7th Oct 08, 1:12 PM
    • 498 Posts
    • 250 Thanks
    DonnySaver
    • #4
    • 7th Oct 08, 1:12 PM
    • #4
    • 7th Oct 08, 1:12 PM
    I couldn't even login to my Kaupthing account a few minutes ago. Keeps saying my login details are incorrect but I know they aren't. System must either be swamped or blocked !
  • sunshine-days
    • #5
    • 7th Oct 08, 1:22 PM
    Landsbanki Guernsey: in their words
    • #5
    • 7th Oct 08, 1:22 PM
    In answer to:

    Do any of the guarantees of the subsidiary by the parent company entitle us also to compensation under the parent company's home-country scheme e.g. the Icelandic scheme in the case of Kaupthing?


    The exact wording on the Landsbanki Guernsey site today states:

    Q & As

    8. Are my deposits covered by the Icelandic or UK Deposit Protection Schemes?

    No, these schemes do not cover deposits of Landsbanki Guernsey Limited
    • occamsrazor
    • By occamsrazor 7th Oct 08, 1:35 PM
    • 229 Posts
    • 63 Thanks
    occamsrazor
    • #6
    • 7th Oct 08, 1:35 PM
    • #6
    • 7th Oct 08, 1:35 PM
    Does Landsbanki Guernsey have the same "100% guaranteed by the parent company" that Kaupthing IOM has though?
    • occamsrazor
    • By occamsrazor 7th Oct 08, 1:39 PM
    • 229 Posts
    • 63 Thanks
    occamsrazor
    • #7
    • 7th Oct 08, 1:39 PM
    • #7
    • 7th Oct 08, 1:39 PM
    I couldn't even login to my Kaupthing account a few minutes ago. Keeps saying my login details are incorrect but I know they aren't. System must either be swamped or blocked !
    Originally posted by DonnySaver
    Kaupthing Isle of Man online website is working fine for me here right now... no problems.

    Did you mistype your username or password more than one of two times? That happened to me once before and the system locks you out with that same message. A quick call to the bank let them instantly unlock it for me....
    • occamsrazor
    • By occamsrazor 7th Oct 08, 5:17 PM
    • 229 Posts
    • 63 Thanks
    occamsrazor
    • #8
    • 7th Oct 08, 5:17 PM
    • #8
    • 7th Oct 08, 5:17 PM
    The Isle of Man Government has just announced the intention to increase its depositor's protection scheme to £50,000, though this still needs to be approved before it takes effect:

    http://www.iomtoday.co.im/news/Manx-Government-increases-savings-protection.4566940.jp

    This is certainly good news for offshore savers, though I would like to know more details about exactly how the increase will be funded:

    "the new scheme had come after negotiations with banks who had agreed to put in extra funds to cover the scheme, although the Treasury said details of the banks' contributions had yet to be finalised."
    Last edited by occamsrazor; 07-10-2008 at 5:18 PM. Reason: spelling
  • qwe3333
    • #9
    • 7th Oct 08, 5:25 PM
    • #9
    • 7th Oct 08, 5:25 PM
    The Isle of Man Government has just announced the intention to increase its depositor's protection scheme to 50,000, though this still needs to be approved before it takes effect:

    http://www.iomtoday.co.im/news/Manx-Government-increases-savings-protection.4566940.jp

    This is certainly good news for offshore savers, though I would like to know more details about exactly how the increase will be funded:

    "the new scheme had come after negotiations with banks who had agreed to put in extra funds to cover the scheme, although the Treasury said details of the banks' contributions had yet to be finalised."
    Originally posted by occamsrazor

    to be approved later this month. Not fast enough for me.

    Although i doubt how much the IOM could fund having massive deposits and few taxpayers. (covering from other banks will not cover a bank failure, in my opinion)
    • occamsrazor
    • By occamsrazor 7th Oct 08, 5:44 PM
    • 229 Posts
    • 63 Thanks
    occamsrazor
    More info from the Isle of Man Government on the proposed increase here:

    http://www.gov.im/lib/news/treasury/savingsprotectio.xml
  • qwe3333
    Bank gives assurance to customers




    Published Date: 07 October 2008
    MANX customers of the Isle of Man branch of the Iceland-based Kaupthing Singer & Friedlander bank have been given a reassurance by the company after concerns over its future.


    First, there were moves by the Icelandic government's Central Bank to support the bank with a 500 million Euro loan.

    Then some customers wanting to make inquiries or move funds found that they couldn't get through when they phoned the Isle of Man branch in St George's Street, Douglas.

    One customer from England phoned iomtoday to say he had been phoning the branch for 24-hours and when he finally got through the phone was immediately put down by whoever answered it at the bank.

    A spokesman for Kaupthing Singer & Friedlander said this was due to problems with the phone network.

    'We did have some telecom issues on Monday which we understand may have led to some callers not being able to get through to our offices,' said the spokesman.

    'We have looked into this, taken the appropriate action, and we are confident this issue has now been resolved.'

    Commenting on the government loan issue the spokesman said the company was keen to point out that Kaupthing Singer & Friedlander had not been nationalised.

    The spokesman said there was some confusion as the Icelandic bank Landsbanki had been taken over by the government.

    'The Icelandic bank, Landsbanki, was taken over by the Icelandic Government,' said the spokesman.

    'Furthermore, just over a week ago, the government announced the purchase of a 75 per cent stake in Glitnir (Iceland's third largest bank].

    'The Central Bank is now supporting Kaupthing.

    'Kaupthing has received support from the government in the form of a 500 million euro loan from the Central Bank to facilitate the continuation of business as usual.

    'In addition, the Central Bank has just announced that Iceland has received a four billion euro loan from the Russian Government, which will help stabilise the Icelandic krona and inject much needed liquidity into the Icelandic financial system.

    'Kaupthing will remain a public company and will maintain its strong leadership role in the Icelandic financial markets.'

    The company's spokesman also said that the Kaupthing Singer & Friedlander website was operating normally although it was experiencing a higher than normal level of usage.

    'We are not aware of any specific problem with our website,' added the spokesman.

    'We believe all banks are experiencing increased website traffic in the current climate which could be restricting access for some users.

    'Due to ongoing general market turbulence, plus the recent events in Iceland, our call centre is much busier than usual, or than we had anticipated, and, whilst we have strengthened our team, there are still some customers who are experiencing difficulty in contacting us.

    'We apologise to any clients who have been inconvenienced by this, and would ask that they remain patient with us and try to contact us again.'

    The statement ended by reminding customers that deposits held with Kaupthing Singer & Friedlander in the Isle of Man were covered by the depositors' compensation scheme.

    This means that if the bank suffered a collapse customers would receive up to 75 per cent of the eligible protected deposit up to a maximum compensation payment to any one depositor of 15,000.

    http://www.iomtoday.co.im/news/Bank-gives-assurance-to-customers.4567429.jp
    • occamsrazor
    • By occamsrazor 7th Oct 08, 6:12 PM
    • 229 Posts
    • 63 Thanks
    occamsrazor
    Then some customers wanting to make inquiries or move funds found that they couldn't get through when they phoned the Isle of Man branch in St George's Street, Douglas.
    Originally posted by qwe3333
    Thanks for the article qwe3333. I have to say although I had a few delays today, I've been able to get through by telephone quite a few times over the last two days, and the obviously overworked staff there have been as helpful and efficient as always. The service at Kaupthing IOM is superb, I feel bad they've been dragged into all this mess and hope it all sorts itself out soon.

    I do think the IOM Govt should try to rush through the increase in depositor's protection ASAP. Now is not the time for uncertainty and a speedy response would calm fears and likely prevent any problems happening in the first place.
  • Jake'sGran
    I couldn't even login to my Kaupthing account a few minutes ago. Keeps saying my login details are incorrect but I know they aren't. System must either be swamped or blocked !
    Originally posted by DonnySaver
    I have looked at it a few times today and it has been updated with comments from the CEO. A withdrawal was no problem and an error on the screen was put right very quickly when I used their secure messaging.
  • miaviv
    Whilst not an expert, I would imagine that deposits in the IOM would be covered by that country's guarantee and not the "nationality" of the bank's Head Office. So any depositor compensation scheme in the UK, Ireland etc would not logically apply if your account is held in the IOM.

    Does anyone think differently ?
    • occamsrazor
    • By occamsrazor 7th Oct 08, 9:00 PM
    • 229 Posts
    • 63 Thanks
    occamsrazor
    miaviv - please see my reply to your other post here:

    http://forums.moneysavingexpert.com/showthread.html?p=14787901

    From what I can tell.... If the Irish Govt do decide to include subsidiaries of Irish banks based in the Isle of Man (e.g. Anglo-Irish Bank Isle of Man branch) then your savings would effectively be covered by both guarantees, including the full 100% of the Irish Govt guarantee. Of course it's not yet known if those subsidiaries will be included in the Irish scheme or not.
  • miaviv
    miaviv - please see my reply to your other post here:

    http://forums.moneysavingexpert.com/showthread.html?p=14787901

    From what I can tell.... If the Irish Govt do decide to include subsidiaries of Irish banks based in the Isle of Man (e.g. Anglo-Irish Bank Isle of Man branch) then your savings would effectively be covered by both guarantees, including the full 100% of the Irish Govt guarantee. Of course it's not yet known if those subsidiaries will be included in the Irish scheme or not.
    Originally posted by occamsrazor
    Thanks for both your posts in reply to my queries. I'm interested in the Anglo Irish bank now if their guarantees are so good, I'll wait to see what the bailout brings tomorrow if indeed that is what we are going to get. I'll no doubt be on here again tomorrow night to see some of your reactions. I've spent too long worrying about this on my own, it is nice to exchange with others who may be in the same situation.
    • occamsrazor
    • By occamsrazor 7th Oct 08, 10:27 PM
    • 229 Posts
    • 63 Thanks
    occamsrazor
    Seeing as there seems to be a few expat savers here now also looking for safe/safeish havens for their money, here's a list of some options for non-UK-residents I've collected over the last few months that don't rely on the Isle of Man compensation scheme:

    Northern Rock Guernsey - under semi-temporary public ownership by the UK Govt

    Anglo-Irish Bank Isle of Man
    - MAY be covered by the Irish Govt's 100% guarantee, we have to wait to find out if this is the case

    Barclays Wealth International - available to non-residents and accounts can be offshore (usual offshore compensation or lack of) OR based in London thus qualifying for FSCS 50k guarantee - see here

    Halifax Non-UK
    - this page would seem to imply the listed accounts can be opened by non-residents.

    Anyone got any others?

    Compensation schemes aside, it could be argued that simply choosing the right offshore bank will make more difference to your deposit's safety - e.g. I think it's arguable that HSBC Offshore is pretty safe because HSBC is considered pretty safe at the moment (though their interest rates aren't good).
  • qwe3333
    Thanks for the article qwe3333. I have to say although I had a few delays today, I've been able to get through by telephone quite a few times over the last two days, and the obviously overworked staff there have been as helpful and efficient as always. The service at Kaupthing IOM is superb, I feel bad they've been dragged into all this mess and hope it all sorts itself out soon.

    I do think the IOM Govt should try to rush through the increase in depositor's protection ASAP. Now is not the time for uncertainty and a speedy response would calm fears and likely prevent any problems happening in the first place.
    Originally posted by occamsrazor

    i agree their service has been very good.

    IOM need to realise that if they want deposits most people will want similar protection to other countries.
  • qwe3333
    Seeing as there seems to be a few expat savers here now also looking for safe/safeish havens for their money, here's a list of some options for non-UK-residents I've collected over the last few months that don't rely on the Isle of Man compensation scheme:

    Northern Rock Guernsey - under semi-temporary public ownership by the UK Govt

    Anglo-Irish Bank Isle of Man
    - MAY be covered by the Irish Govt's 100% guarantee, we have to wait to find out if this is the case

    Barclays Wealth International - available to non-residents and accounts can be offshore (usual offshore compensation or lack of) OR based in London thus qualifying for FSCS 50k guarantee - see here

    Halifax Non-UK
    - this page would seem to imply the listed accounts can be opened by non-residents.

    Anyone got any others?

    Compensation schemes aside, it could be argued that simply choosing the right offshore bank will make more difference to your deposit's safety - e.g. I think it's arguable that HSBC Offshore is pretty safe because HSBC is considered pretty safe at the moment (though their interest rates aren't good).
    Originally posted by occamsrazor

    A&L and B&B international still have good rates relative to Abbey. Might want to get in before they synchronize with abbey.

    geurnesy offers no protection whatsoever, which is a bit off putting.
  • expatfrance
    Regarding Non-UK customers opening UK accounts. I have tried HBOS and despite what their web site says they were next to useless. Kept refering me to Bank Of Scotland (IOM) which is not what I wanted.

    When I eventually got through to someone they said I had to write a letter and then they would send me the application forms and I was not able to request the application forms over the phone.

    I think it may be possible to open an account with HSBC UK.

    Does anyone have any ideas how to break a fixed term deposit account with Kaupthing IOM apart from dying?

    Having looked at the IOM Compensation scheme and their proposed increase to 50,000 as far as I can make out it is not worth the paper it is written on unless they increase the levey that the would impose on any remaining banks if it was called into action.

    Currently the levy is 250,000 per year. I believe there are about 50 banks registered in IOM so that would be 13,250,000 in total per year. That would cover about 880 depositers claiming the maximum 15,000. Not very reassuring
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