Alistair Darling guarantees all Icesave deposits

I see no reason for Darling covering depositors of foreign banks, he has enough on his plate protecting savings in British Banks. Perhaps Iceland can pay back with cod. Derek.

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Bitstring , from the wonderful person DerekF said

Except 'icesave' is no more a foreign bank than Abbey National or B&B are .. british premises, british staff, british customers, british regulators .. foreign owners.

But was your money in Iceland or here? I'm ING not ICE and presumably better covered by EU rules. Derek.

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Well I heard what he said, and I've seen the BBC news clip, but I'm still not 100% convinced that everyone will get *all* their money back. His remark seemed to be aimed at those with over 50,000 - and he seemed to be saying that the UK government would extend the compensation beyond the 50k limit. But he wasn't very specific about smaller investments, falling within the limits of the Icelandic governments compensation. I'm not sure that he

*explicitly* said that the UK would pick up the tab for Iceland's default - so I await the full details of the compensation scheme with interest.

DerekF wrote: ...

But wasn't Iceland also covered by EU rules - part of the EEA or whatever it's called these days.

This strikes me as a rather odd decision.

People who invested in Icesave must have been aware that investing in a foreign bank had inherent risks, hence the higher than average return on the investment, and those who decided the risks were too rich for their blood gave the bank a wide birth and invested elsewhere and received a suitably lower return.

But now it seems our taxes are going to be used to pay off everyone, in full, and over and above the £50,000 too! Are we going to be indemnifying bookies next? Paying off all bets out of tax payers monies, even if the horses didn't actually win?

No, not a cool decision at all in my opinion.

Ah yes, but when you've got governemental guarantees that your money will be safe in any eventuality, then that's a different kettle of fish. I joined Icesave after reading all the small print and guarantees. Iceland is apparently reneging on its part of the bargain, so whilst I agree with you, its odd that the UK should bail out savers tied up in that, at the end of the day, Icesave were trading in the UK within a UK regulationary framework with UK guarantees too and so it is of course to be expected that the company's customers should be looked after by our own government.

This strikes me as a rather odd decision.

People who invested in Icesave must have been aware that investing in a foreign bank had inherent risks, hence the higher than average return on the investment, and those who decided the risks were too rich for their blood gave the bank a wide birth and invested elsewhere and received a suitably lower return.

But now it seems our taxes are going to be used to pay off everyone, in full, and over and above the 50,000 too! Are we going to be indemnifying bookies next? Paying off all bets out of tax payers monies, even if the horses didn't actually win?

No, not a cool decision at all in my opinion.

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Since when has depositing savings been a bet!!

The fact is that bank management has been criminally irresponsible and it's about time governments begin holding those people behind it criminally responsible. Pure greed is what has caused this mess, stupid people borrowing money they cannot afford to pay back and stupid bank management allowing them to do so.

It is one thing to bank with UK licensed banks, quite another thing to use those licensed by a foreign country - that *is* a gamble.

Indeed, but it should be down to Iceland to back its banking system, not UK tax payers!

Icesave was licensed to provide banking services in the UK. It just happens to be foreign owned.

Abbey, Alliance & Leicester, Bradford & Bingley, and Cahoot are also foreign owned. Are you saying that using those banks should therefore be considered a gamble?

Chris

AIUI, ING depositers are in exactly the same position as Icesave depositers. Unlike the UK banks, and some foreign banks like ICICI, ING savers have to reclaim the first part of any compensation from the Dutch government and the rest from the FSCS. Of course, being a much larger country, Holland is a safer bet than Iceland for honouring its commitments! Icesave depositers were assured, not just by the bank, but also by all the financial pundits, that savings up to £35k (now £50k of course) were completely safe. No-one expected an entire country to become bankrupt!

Ret.

They are not covered by our compensation scheme and that was, quite clearly, was the gamble UK investors could chose to accept or not.

These *are* covered by our compensation scheme.

They are not covered by our compensation scheme and that was, quite clearly, was the gamble UK investors could chose to accept or not.

But hardly a gamble at the time. Icesave was a 'best-buy' on the all the financial pages and web-sites and depositers were assured that their savings were fully protected up to £35k (now £50k). At the time I opened my Icesave account, the notion that the entire country of Iceland would become bankrupt was laughable.

Ret.

Apparently a number of local authorities have millions of pounds with Icesave at least £200,000,000 according to one MP.

We last night transferred most of our funds from ING. It will go into our Northern Rock accounts. Derek.

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I avoided them, and looked down the best buy table until I found Birmingham Midshires and Principality Building Society, and put my money there, at a lower rate, as I figured the higher rate wasn't worth the risk of putting the money in an Icelandic, Nigerian or Indian bank.

If you look back at older posts I made, you will see that I said that the Icelandic guarantee scheme was worthless because there was no way it could afford to pay out if one of their big banks went under, and that there was no way the Icelandic government could afford to bail them out.

I very much doubt that he would pay out money to the rich depositors with

Iceland isn't in the EU, but it is in the EEA. That means you get the worst of both worlds. Unlike Nigerian and Indian banks, it isn't required to fully register here, and unlike EU banks, their own regulatory system doesn't have EU backing.